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HomeMy WebLinkAbout2003-01-14 WSB AGENDAW A TER & SEWER BOARD AGENDA Tuesday, January 14, 2003 C OMMUNITY DEVEL OP MENT C ONFERENCE ROOM 1. MINUTES OF THE DECEMBER 10, 2003 MEETING. (ATT. 1) 2. GUEST : BILL McCORMICK -OPERATIONS SUPT. -U TILITIES RE: TRIHALOMETHANES (ATT. 2) 3 . GARAGE TAP FOR 3555 S . OGDEN ST . (ATT. 3) 4. HOTEL SE WER TAP AGREEMENT -WINGATE. (ATT. 4). 5 . MEMO FROM CHIEF MOORE RE: SECURITY OF ENGLEWOOD WATER TREATMENT PLANT AND STORAGE FACILITIES. (ATT. 5) 6. VARIOUS WATER RELATED ARTICLES . (ATT. 6) 7. ENGLEWOOD/CENTENNIAL WATER SUPPLY AND FACILILTIES AGREEMENT. (ATT . 7) 8. OTHER. WATER AND SEWER BOARD MINUTES December 10 , 2002 A T l o I The meeting was called to order at 5 :45 p.m. Members present: Members absent: Also present as a guest: Bradshaw , Cassidy, Clark, Otis , Higday, Kasson Wolosyn , Habenicht, Moore Joe Tom Wood , Water Engineer with Martin &Wood 1. MINUTES OF THE NOVEMBER 12, 2002 MEETING. The Englewood Water and Sewer Board Minutes from the November 12 , 2002 meeting were approved as amended . Mr. Kasson moved : Ms. Bradshaw seconded : Ayes: Nays: Members absent: Motion caITied . To approve the November 12, 2002 E nglewood Water and Sewer Board Minutes. Bradshaw , Cassidy, Clark, Otis , Kasson, Higday None Wolosyn, Habenicht, Moore 2 . CITY DITCH LICENSE AGREEMENT FOR K.C. ENSOR AND WILDACRES . E nsor Properties and the Littleton Large Animal Clinic (WildAcres , LLC) have submitted a License Agreement and Construction Easement for crossing Englewood's City ditch with an access road . The Colorado Department of Transportation (CDOT) is widening Santa Fe along the City Ditch from County Line Road to Prince Street. This section is being widened to allow construction of separating medians and additional lanes to improve traffic safety. Englewood's City Attorney and the Utilities Engineer have reviewed and approved the License Agreement and Construction Agreement submitted by Ensor and the WildAcres, LLC. Mr. Higday moved; Mr. Otis seconded: Ayes: Nays: Members absent: Motion carried. To recommend Council approval of the City Ditch License Agreements submitted by Ensor Properties and WildAcres, LLC. Bradshaw, Cassidy, Clark, Otis , Kasson, Higday None Wolosyn, Habenicht, Moore 2. NEWPAPER ARTICLE-ROCKY MOUNTAIN NEWS. The Board received a November 11, 2002 Rocky Mountain News Article titled, "A war about water." This is an information-only item discussing a water rights dispute on the S. Platte River over administering underground irrigation water in northeastern Colorado. 4. CAROLLO ENGINEERS -AGREEMENT FOR PROFESSIONAL SERVICES. The Board received a copy of the Agreement for Professional Services and a Task Order from Carollo Engineers for engineering services for aqua ammonia storage at the Allen Treatment Plant and powered activated carbon storage and feed at the Union A venue Pump Station. The Utilities Department received three design proposals and selected the Carollo proposal which utilizes the existing water treatment plant for the ammonia storage rather than constructing a new building. The proposed design will allow construction of a permanent feed system and storage area for the powdered activated carbon. Powdered activated carbon is used when certain river conditions are severe, causing taste and odor problems. The Professional Services Agreement describes the Approach for Improvements , Scope of Services, time of performance and payment and administration of the projects. Carollo's fee is $127 ,000. It was noted that time is of the essence in order to have the system operational before taste and odor occurrences begin in the summer. The Board took an informal vote supporting this approach and agreed that the Director of Utilities should sign the engineering contract. When the project is 80% designed, selected contractors will be requested to submit bids. At that time, the city council will be asked to award the construction contract to the acceptable bidder. 5. SANITARY SEWER LINING IMPROVEMENTS. The Utilities' Distribution and Collections crew discovered two sanitary sewer lines that needed repair during flushing. The lines were videotaped and it was determined that both 8" clay lines were in failure with extensive cracking. The first repair segment is located in S. Zuni St. between W . Bates Ave . and W. Cornell Ave. for a distance of 271 feet. The second segment is located between S. Washington St. and S . Clarkson St. north of US 285 for a distance of 326 feet. Because of dangerous conditions and restricted access, the trenchless pipe rehabilitation method is being used to minimize traffic disruption and impacts on residents. Bids were received from two vendors , the lowest being from Insituform at $32,600.40. The Board informally approved the Utilities Department issuing an Award of Bid and a Notice to Proceed to Insitufonn. The meeting adjourned at 6:05 p .m. The next Water and Sewer Board meeting will be January 14 , 2002 at 5:00 in the Community Development Conference Room. Respectfully submitted, Cathy Burrage Recording Secretary American Water Works Association -Waterweek A TT., '2 The law grants IAIP access to all pertinent information , including infrastructure vulnerabilities, and directs all federal agencies to "promptly provide" IAIP with all information they have on terrorism threats and infrastructure vulnerabilities. It further exempts from disclosure under both federal and state freedom-of-information laws all critical infrastructure information submitted voluntarily to OHS , requires OHS to establish uniform government-wide procedures for handling such information and establishes penalties for those who unlawfully disclose such information, including mandatory removal from office or employment. The bill also authorizes the president to delegate authority for federal critical infrastructure protection programs to enter into voluntary agreements to promote infrastructure security , including with any information sharing and analysis organizations (e.g ., the Water loformci_tigo Sbi3Jiogan<:JAIJCllY._~i$_C~n.ter). The department will also include a science and technology division charged with overseeing all security-related research and development efforts and developing a national policy and strategic plan that identifies R&D priorities. The division will not deal with relevant public health-related research, however. The law specifically reserves to the Department of Health and Human Services the responsibility for research relating to countermeasures for chemical, biological, radiological, nuclear, and other emerging terrorist threats, including the development of a coordinated national strategy . Also included in the bill is a provision establishing an Office for State and Local Government Coordination charged with assessing and seeking resources needed by state and local governments to implement counterterrorism measures , providing state and local governments with regular information and technical support and developing a process "for receiving meaningful input from state and local government to assist the development of the national strategy for combating terrorism and other homeland security activities ." The bill does not include chemical security provisions that water suppliers feared would have required those subject to the Clean Air Act's Risk Management Program requirements to conduct separate vulnerability assessments . Chesapeake not immune from TTHM claims A Virginia Circuit Court judge recently ruled that Che$apeake , Va ,, is not immune from a lawsuit by a woman who claims the city fraudulently failed to warn her of the possible risks associated with disinfection by-products , which she says caused her 1998 miscarriage . In rejecting the city's argument for sovereign immunity , Judge Norman Olitsky of the Chesapeake Circuit Court ordered an evidentiary hearing in early 2003 , which will provide the basis for him to decide whether the case should go to trial. The claimant is among 170 women who allege the city "knowingly and fraudulently" withheld information regarding the levels of and reproductive risks associated with total trihalomethanes (TTHMs) from as far back as the 1980s. Rather than consolidate the claims into a single case, the judge opted to handle a single claim as a test case, a major element of which involves whether the suit was filed within the state's two-year statute of limitations. The suits stem from the city's initial notice in March 1998 alerting pregnant women of potential reproductive risks from TTHMs , levels of which the city expected to increase between the time the city removed air stripping towers and began operating a new reverse osmosis (RO) plant. The notice was part of a CC!mpc;iignto i nfon:ncust9mers of a year-long TTHM-compliance exemption issued by the state to expedite the RO project. The city, which has never violated TTHM standards, rng11 l13,.rJy__QQ.§J§IlJ::fMJ ~.'"'.~l$ on the Internet. / ·/ I 1· / . tj ( ,,) ( . . ._';J)U' / . rv-I ,· vi(ILs ./ .. { f' 1~ (,.-. 4'J ~ wfiCI(,. http://www.awwa.org/Communications/waterweek/subscribers/currentissue/ Gt 1 SFPUC to investigate faulty gate valve r Heterotrophic Plate Nitrite Temperature Turbidity pH TTHM's HAAS's Total Chlorine Count Residual Date Sample Site cfu/ml mg/I c ntu 's ug~ ug/I mg/I 3/28/02 4600 S. Lipan St. 98 u 11 0.23 3995 S. Galapago St. 1.3 u 10 0.16 2710 S. Washington 6.3 u 9 0.17 3535 S. Lafayette St. 19 .3 u 11 0.18 6 MG Tank <0.3 u 10 0.22 414102 4600 S. Lipan St. 1 u 9 0.16 3995 S. Galapaqo St. BDL u 9 0.13 2710 S. Washinqton BDL u 9.5 0.16 3535 S. Lafayette St. 11 u 11 0.17 6 MG Tank BDL u 8 0.1 6 4/10/02 Allen Plant 24 6.9 Post Ch/oramine Conversion 719102 Allen Plant 32 1000 Enqlewood Parkwa' 42 2323 W. Baker Ave . 50 Allen Plant 10 .4 1000 Englewood Prky 12 .1 818102 3MQ Tanks 5 u 23 .5 0.18 0.45 5050 S. Galapago St. 4 u 23.4 0.16 1.03 3535 S. Lafayette St. 6 u 25 .2 0.20 0.51 4600 S. Lipan St. 64 u 24 .0 0.21 0.53 2710 S. Washinqton 2100 u 25 .6 0.38 0.48 2323 W. Baker Ave . 2290 u 26 .5 0.31 0.28 8/19/02 4811 S. Broadway 34 .3 8.9 1000 Englewood Parkwa / 35 .9 16 .6 3380 S. Lincoln St. 42 .8 5.2 2323 W. Baker Ave. 51 6.5 11/14/02 3Mg Tanks 20 u 9.5 0.16 8.16 0.55 5050 S. Galapago St. 290 u 10 0.25 8.05 0.14 3535 S. Lafayette St. 70 u 11 0.23 8.00 0.44 4600 S. Lipan St. 160 u 9.8 0.25 7.97 0.33 2710 S. Washington <10 u 10.4 0.33 8.03 0.66 2323 W. Baker Ave . 410 u 11 .5 0.18 8.11 0.34 11/14/02 4811 S. Broadway 16 .8 5.9 1000 Englewood Parkwa• 16 .4 25 3380 S. Lincoln St. 11.4 4.2 2323 W. Baker Ave . 27 .7 1.2 AT T .. 3 December 10, 2002 City of Englewood Sewer And Water Board c/o Mr. Stu Fond Currently, I am converting my garage into fully handicap accessibly living quarters for myself. I would like to make a request for an exception, allowing me to bundle my water and sewer connections with the main house. Currently, I am expecting to proceed with connecting with brand new taps. The variance is recorded on the deed that it's use is exclusive to my use only. W. David Penland 3555 S. Ogden St. 303.806.8528 Cc,rry ,,,:: €Nf:..t..€r.JCC '.::> C,cmm 1.4.N ,,.,.. i::.c; •.; c....i.->rn € <1 :- I OOQ ~woo~ -n:.i..:.y r:;;.J·~~,co ic110 {' c T y 0 F ENGLEWOOD COMMUN T y DEVELOPMENT OFFICIAL NOTIFICATION TO: Arapahoe County Clerk and Recorder 5334 South Prince Street Littleton, CO 80166 BOA CASE NUMBER: MEETING DATE: SUBJECT PROPERTY: PROPERTY OWNERS: 2-2002 March 13 , 2002 3555 South Ogden Street W. David and Tracy Penland B2084766 5/07/2002 12:29:15 PG: 0001-001 5.00 DOC FEE: 0.00 TRACY K. BAKER ARAPAHOE COUNTY The City of Englewood Board of Adjustment and Appeals considered the request for a variance to convert an existing garage to a dwelling unit that is detached from the principal dwelling unit and to reduce the required minimum floor area of 650 square feet to 400 square feet. This is a va riance to 16-4-5:B3, Permitted Principal Uses and 16-4-5:03a, Mini mum Floor Area of the Englewood Municipal Code. Further, the variance terminates upon ei ther W. David Penland no longer residing at 3555 South Ogden Street or upon the tran sfer of the property to a party not including W. David Penland, whichever event occurs first. The Board approved the va riance request by a vote of 7-0. '11. ~ ~ton Recording Secretary The property owners hereb y ackno vv !eclge that they 1.mderstand the conditions on the variances granted b y the Board of Adjustment and Appeals and agree to abide by those conditions. The owners further agree to notify the City of Englewood upon the occurrence of eithe~ ?f)he.se abo~sted conditions. r,r-. / 1· 1 ; .·' . I '( ,( ,-~/ / ·' I d{ )\r/;;1 -{~a~{(. / W/Qa v id Penfand l . -Ii i ,. .dt"r L--ku.a# Witness cc: Case File #2-2002 Building Department Property Owners 1000 Englewood Parkwa y Englewood , Colorado 80110 PHONE 303-762-2342 FAX 303-783-6895 www .ci .englewood.co.us f \ , delinquent turn-off, a fee of thirty dollars ($30.00) shall be due and payable by the property owner and shall be billed to the property by the City within thirty (30) days after the service has been performed. 12-lB-i: Number of Users on Service Restricted. A. B. More Than One Premises To A. Service Connect ion Prohibited: E ach premises or property or building{§.) situated on a premises or property in a manner which would allow the premises or property to be subdivided and the b uilding~s ) sold separately shall be serv"ed .by a .. separate service connection directly to the nearest main without crossing~ other adjoining premises or preperey properties and with separate curb stops involving only one account when water is turned on or shut off. Extension of service to another premises or building from an existing service connection is prohibited and shall be subject to shutoff wi.fhout the Gity being liable for any damage. Exceptions to this requirement may be granted by the City Manager or designee with the concurrence of the Water and Sew er Board upon a review of a written request of the property owner, in which the property owner · ustrates with both written and graphic descriptions , why the exception should be granted. Existing premises, properties or buildings which do not conform to this requirement may maintain their service connection configurations unless and until such time , in the opinion of t he Cicy ::VIanager or designee with the concurrence of fhe Water and Sewer Board, the service must be separated. Two Or ~Vlore Users On Same Ser vice Line: In case two (2) or more users are supplied from the same service line , if any of the parties fail to pay the water charges when due, or to comply with any ri.tle of the City, the City reserves the right to shut off the water to tb.e whole service until such charges are paid, or the rules strictly complied with, and it is expressly stipulated that no claim for damage or otherwise may be made against the City by any user whose water charges have been paid or who has complied with the rules of the City, because of such turnoff, it being expressly stipulated that the necessity for such shut off shall be deemed to be the joint act of all served through such service. Section 2. The City Council of the City of Englewood, Colorado hereby amends Title 12, Chapter 1, Section 4, of the Englewood Municipal Code 2000, to read as follows: 12-1-4: Work to be Done by Plumbers et'" Drai:B:la:yers. All work on water pipes or fixtures which .. are connected to the City's potable water distribution system and which are located from the curb stop to a point one foot (l') inside the building shall be accomplished by a licensed plumber er :h-ainlaye::' under bond to the City. Section 3. The City Council of the City · of Englewood, Colorado hereby amends Title 12, Chapter 2, Section 4, Subsection A and the addition of a new Subsection K, of the Englewood ?vf unicipal Code 2000, to read as follows: -3- HOTEL SEWER TAP AGREEMENT THIS AGREEMENT, is made the 20th day of November, 2002, the CITY OF ENGLEWOOD whose address is 1000 Englewood Parkway , Englewood, Colorado 80 110, (herein after City); and ROCKY MOUNTAIN WINGATE, a Colorado corporation, whose address is 8000 E. Peakview, Greenwood Village, Colorado , (hereinafter Wingate Inn). WHEREAS, Wingate Inn requested a reduction in sewer tap fees because they believe their Hotel 's water usage is less per unit than a single-family equivalent. The su bject Hotel is located at 8000 E. Peakview, Greenwood Village, Colorado, also known as Wingate Inn ; and WHEREAS, the standard tap fee is based on a normal flow of two hundred (200) gallons per day and Wingate Inn es timates that their per unit flow is no more than o ne hundred ( 100) ga llons per day. NOW THEREFORE the Parties agree as follows: 1. The City wi ll sell eigh ty-five (85) sewer taps for its Hotel units at one-half the standard sewer charge, based on their estimate of no more than 100 gallons per day per unit real flow. This is a minimum charge and in no event will the base tap fee be les s than one-half ( 112) the s tandard sewer charge. 2. The initial tap payment to the City by Wingate Inn will be fifty-nine thousand five hundred dollars ($59,500.00) for Englewood tap fees; twel ve dollars and fifty cents ($12 .50) for the permit; and a Big Dry Creek Interceptor Basin Charge of fo ur thousand two hundred fifty doll ars ($4,250.00), fo r a tot al of s ixty-three thousand seve n hundred sixty-two dollars and fifty cents ($63,762.50). 3 . Wingate Inn will issue an irrevocable, stand-by letter of credit in the amount of s ix ty-three thousand seven hundred fifty dollars ($63,750.00), which will be used for any additional tap fees . This letter of cred it will be held by the City for tap fees as required pursuant to this Agreement. 4. The City will monitor winter (Novem ber I through April 30), bi-monthl y water usage at the Hotel during a five-(5) year period . During that time, Wingate Inn will monitor water consumption on a daily basis. Wingate Inn will furnish the City with a report on daily water consumption and the number of rooms occupied on the corresponding days. The y will s ubmit the report to the City on a monthly basi s. 5. If at any time during the five-(5) year period, the daily, per unit consumption goes ove r one-hundred (100) gallons per day, Wingate Inn will pay the additional tap fee owed. If the fee is not paid within sixty (60) days, the City will make periodic draws on Rocky Mountain Wingate of Colorado's letter of credit to pay to the City additional sewer tap fees based on the amount of flow in excess of o ne hundred (100) gallons per day as billed by the City of Englewood . If Wingate Inn 's daily, per unit usage is less than one hundred (I 00) gallons per day, the City will not owe Wingate Inn any refund . 6. Additional sewer tap fees will be computed on the basis of two hundred (200) gallons per day being equal to a tap fee of $1,500 .00. As an example, if the usage goes over one hundred (I 00) gallons per day by five (5) gallons per day, then five (5) gallons per day is two and one-half percent (2 112%) of the two hundred (200) gallons per day, two and one-half percent (2 1/2%) of one thousand five hundred dollars ($1,500) is thirty-seven dollars and fifty cents ($37 .50) times one hundred and sixty- one (161) hotel units is six thousand thirty-seven dollars and fifty cents ($6,037.50) in additional sewer tap fees. The higher amount, in this example the 105 gallons per day per unit, will become the new base line for tap fees. Once the baseline reaches 200 gallons per day, per residential unit, the maximum tap fee will be owed. In no event shall the total tap fees exceed one maximum tap fee per unit. 7. However, should additional units be added to the project at any time, the tap fees shall be increased by the number of additional units. If the units are added after the five (5) year period described in paragraph 5 above, or after a final base line for tap fees has been reached, the tap fees for the new units will be the same as the final tap fees for the original units . 8. Any accidental discharge of metered water of an unusual and non-recurring nature where the City is notified within 24 hours of discharge and Wingate Inn provides documentation of the nature and extent of the discharge may be excluded from the calculation of the tap fees. The filling of a swimming pool will not be considered an accidental discharge under this paragraph. 9. At the end of five (5) years or on the date on which Wingate Inn has paid the additional sewer tap fees associated with an increase in the baseline for tap fees to 200 gallons per day per unit, whichever event shall occur first, the letter of credit may be withdrawn and the City will no longer monitor water usage except for normal, annual sewer billing purposes. 10. Any additional tap fees paid pursuant to this agreement are tap fees only and shall not be considered sewer treatment charges. Any money owed the City under this Agreement is a fee for the sewer tap. 11. The City and/or it's auditor maintains the right to enter the property to examine the water use records, the hotel occupancy records and to check water meter readings. 12. Wingate Inn gives the City the right to disconnect the hotel for nonpayment of any tap fees or sewer treatment fees due the City. 13. This Agreement shall not be assigned by any party without the prior written consent of the other and this agreement shall be binding on any successors or assignees. 14. Wingate Inn confirms it has eighty-five (85) units in this Hotel and agrees that it shall not add additional hotel units to the City of Englewood 's sewer system without written approval of the City . 2 15. Any notice required or permitted by this Agreement shall be in writing, and shall be deemed to have been sufficiently given for all purposes if sent by certified mail or registered mail, postage and fees prepaid, addressed to the party to whom such notice is to be given at the address set forth below, or at such other address as has been previously furnished in writing, to the other party or parties. Such notice shall be deemed to have been given when deposited in the United States Mail. The notice shall be sent to : CITY OF ENGLEWOOD ATTN: Utilities Department 1000 Englewood Parkway Englewood, CO 80110 Steve Sparks, Managing Partner clo Rocky Mountain Wingate, LLC 2305 Catron Bozeman, MT 59718 16. This Agreement represents the entire agreement between the Parties and there are no oral or lateral agreements or understandings. This Agreement may be amended only by an instrument, in writing, signed by the Parties. If any provision is found to be void by a court of competent jurisdiction, no other provision shall be affected by such holding. All of the remaining provisions shall remain in full force and effect. 17. A waiver by any party to this Agreement or the breach of any term or provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach by either party. 18. The parties hereto warrant that the signatories below have full and lawful authority to execute this Agreement on behalf of Wingate Inn and the City of Englewood, Colorado . 19 . The Parties agree that this agreement shall be recorded in the office of the Arapahoe County Clerk and Recorder. IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and year first written above . CITY OF ENGLEWOOD Date:----------- Beverly J. Bradshaw, Mayor ATTEST : Loucrishia A . Ellis, City Clerk 3 ROCKY MOUNTAIN WINGATE, LL -., \~~ By:~~c:;;Yle..:::::::..___.:....1.£.:lJ:_:.....,,,..,...~.,c.-~~~~~~ Date : __ /_~_/_w---'/'---1.._<-11'_\./ __ _ Steve Sparks, Managing STATE OF MONTANA ) SS. COUNTY OF GALLATIN ) Z. o4 I \,7 · ' (" -=--).d-L . On this day of L--{ { e (Y\. b .e ,iJP'·, before me personally appeared S±l v L 5n(j,( l:;.S , known to me to be the · -, ,f[..-, t(the corporation that executed the within anJ foregoing instrument, and acknowledged th ai nstrument to be the free and voluntary act and deed of sa id corporation for the uses and purposes therein mentioned, a nd on oath stated that he was authorized to execute said instrument. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year first above written . My commission expires: 4 A TT. lVIEMORANDUM To: All Safety Services Personnel From: Division Chief Moore and Battalion Chief Schoenbein Date: September 27, 2001 Subject: Security of Englewood Water Treatment and Storage Facilities The City of Englewood maintains numerous water treatment, storage, inlet, and outlet facilities and locations. Each of these facilities and locations could be subject to terrorist assault, especially biological or chemical infiltration. Hydrants: Numerous "fire hydrants" exist throughout the City of Englewood, and are readily visible and accessible from the street. Although most unauthorized hydrant taps are for the purpose of stealing water, it is possible a terrorist could hook up a "tanker" truck, overcome the hydrant exit pressure, and pump a deleterious substance into the already-treated water supply. The impact of such actions would be isolated to that portion of the water system downstream from the compromised hydrant. The upstream distribution and storage system would not be contaminated, due to system pressure and volume. The City of Englewood has placed a bounty on all unauthorized hydrant taps. Any person (employees included) who provides information enabiing the city to arrest an unauthorized user will receive a $100 reward. Authorized hydrant users will possess a City of Englewood hydrant-use permit for a specific location. A sign, with the permit attached, will be placed on the permitted hydrant, in full view. Take nothing for granted; challenge all suspicious hydrant users; and check for an authorized permit. Zuni Tank: An aboveground water storage tank is located on Bates Ave. just east of Zuni St. This tank contains 500,000 gallons of treated water ready for public consumption. The tank, nearly 100' tall, is surrounded by chain link fence with barbed wire. A locked gate may be accessed from Bates Ave. There is a limited-access ladder on the east side of the tank. The presence of a person on the ladder above the lirnited- access point would activate a motion detector. An alarm is sent to personnel at the Allen Treatment Plant, who would then call for a police response. Any unauthorized person within the perimeter fence will be charged criminally (trespass, criminal mischief, criminal tampering, etc.) 5 •' Sherman Tank: Another aboveground water storage tank is located on Sherman Way just west of Sherman St., next to Field Elementary School. The tank and all of its land lies within Englewood. The primary access route, via Sherman St. and Sherman Way, is within unincorporated Arapahoe County. Englewood officers will respond to crimes at this site. The tank is similar in appearance and configuration to the Zuni tank, although the Sherman tank is about 4 0' taller and contains but 200 ,000 gallons of treated water ready for public consumption. Property access is limited in a manner similar to the Zuni Tank, and motion alarms are also activated in a similar way. Likewise, unauthorized persons on the Sherman tank property will be prosecuted accordingly. Union Ave. Pump Station: This pump station, inlets, outlets , and holding pond are contiguous to the north side of U nion Ave. and the east bank of the South Platte River. A locked gate limits vehicle access to the dri veway entrance ; however, pedestrians do have access to the dri veway and initial river intake. The principal facility building and fenced holding pond are posted off limits. Although this facility intakes raw , untreated ri ver water, it may still be susceptible to intrusion and damage . All unauthorized persons within any building or the perimeter fence are subject to arrest. Indi vi duals within or near the intake channels , dri veway, or gates should at least be challenged and identified. The Twelve Million Gallon Storage Tanks at Sunset Ridge: Three massive concrete-covered storage tanks are situated south of Belleview and east of Clarkson in Greenwood Village. Two rectangular tanks each contain three million gallons of treated water ready for public consumption; and one contains six million gallons. Drive south from Belleview on Clarkson to Sunset Ridge Rd., then east to the locked gate. The Highline Canal borders the south side of the tank property. Private properties with homes border most of the remaining sides. The interior of each tank is accessible through a steel "trap door." Although these access points are padlocked, they are vulnerable. The presence of a person on or near one of the tanks would activate a motion detector. A common problem, however, is the activation of the alarm by roaming foxes or skateboarding juveniles; and the fence surrounding the property is not entirely secure, although work is in progress to make it more secure. Because of a high rate of false alarms, Greenwood Village police are slow or reluctant to respond. Englewood officers may be asked to respond, and should do so when called. Unauthorized persons on this property will be prosecuted. .. Charles Allen Water Filtration Plant: This water treatment plant is located at 1500 W. Layton Ave., and is bordered by Windermere on the west, Belleview Park on the south and southeast, Layton on the north, and "Wash-Water Reservoir'' on the east. The facility is surrounded by a barbed wire fence, and is accessible through a rolling gate at the driveway entrance on Layton. Building access doors are locked at all times, except for a south side "staff entrance." Six or seven employees staff the facility during normal business hours; and at least one employee is present at all other times. Motion detectors at remote facilities are monitored locally at all times. Although this facility is reasonably secure, it could be a prime target for sabotage, especially at night and on weekends. Any emergency call to this location should be taken very seriously. Fire Division response may also be necessary to help gain access to locked areas. North Reservoir and Wash Water Reservoir: The reservoirs are situated at Mariposa St., north and south of Layton Ave . The City Ditch flows south to north along the east side of both reservoirs, and feeds into North Reservoir. A barbed wire fence surrounds each. Gates to North Reservoir are located at the southeast comer and midway on the south side. Gates to Wash-Water Reservoir are located within the Allen Filtration Plant perimeter. Again, unauthorized persons within reservoir property, or tampering with flow gates and channels, will be arrested. * * * * * * * * * Englewood's water system is basically divided into two parts: raw water and treated water. Each has a different level of vulnerability. Raw (untreated) water is easily accessible in several locations; for example: the Platte River intake and holding pond by the Union Ave Pump Station; North Reservoir and Wash-Water Reservoir adjacent to the Allen Filtration Plant; the city ditch; McClellan Reservoir (in Littleton); and the Platte River and Chatfield Dam Lake, Englewood's primary water source. The treated-water storage and distribution sites (previously listed) are less susceptible to intrusion and contamination; and each has various levels of security built in and maintained, adequate to prevent tampering by all but the most determined or knowledgeable infiltrator. Raw water sources are the most vulnerable and attractive for someone determined to tamper with Englewood's water supply. However, the high level of treatment, filtering, and chemicals, and the testing of water after treatment prior to storage, should detect and eliminate most common types of infiltrates. '. Increasing the surveillance and patrol presence at all these locations should help reduce the possibility of casual or nuisance destructive activity. If Englewood's water supply does become the target of a dedicated individual or terrorist group determined to disrupt operations or contaminate the distribution system, their actions may be discovered prior to wide-scale deleterious effects on the health of Englewood's citizens. Robert E. Moore III Patrol Operations Division Chief c : Bill McCormick Stu Fonda Chris Olson ft/Jl Don Scho~ein Battalion Chief . : .. : . ·::'~: :-. ~-;~·~: -.-.. ·. , .;~ •,• .. .-.-... ' !.:.· _, .=: ., .. . ..... . ,.,,, ... :. :.·/ ·>:. 1 tlli JJhN V.bH l:"OS r i:>UK.Ji1y, U4;K;~llluttl .:~.~\IV.:;··~-~ -----·~· ,_ ... ,, •, ..... -: Attorney general's office challenges ruling cutting off farmers' wells .· By The As.soclnid Press GREELEY -The Colorado af... tomey general's office is challeng- ing a \fala" judge's rating to sJwt clown welts to farmers llflless they pump more water back into the Soul• Platte River. Tbe attDmey ge-.eral's omce liled aa appeal FridAy mlh the Col- oradv Supreme Court, but A re- spaase Is ul expected uaUI at least March. That leaves maay farmers in Um~ as tliey prepare for anon.er gn>WllJi season.. T008e who depend on the CentrAI Colorado Water Couservancy Dis- •· trict for waler vi.U be able lo keep taking water from its wells for now . The district, wlaich •u about 1,000 wells from Brighton fa Fi>rt Morgan. Hled its waler replace · ment plaa Friday wlfdl will allow the wells to be used in 2003. However Fort :Morgaa-based Groulldwater Appropriators _ of the South Platte, wluch hs wells Crom Denver to Julesburg, bas oo plan in place becAUie it does not own addiUonaJ water. Jucfc e Joaa!Mn Rays ruled last week that the state iA°gineer's of- fice doesn't •ave the authorlly lo approve farmers' use ol about ··.·. . ' 3,oto lrrijation wells. Under the ruling, farmers wm -· have kl ro to water court lo get tbeir well operations approved,· · whicli could t.al:e yeas. They · would m05t · lltcly bave to buy more water t.ofreplace the walet·' · tlaey use, aometlWtg mo.\l farmers <:ao't affCII'd. · N 0 0 N .... N ' c.. 0 loi:: 0 2 0 -l .. N oc ~ "' c "' (JO N ci; N ci; N "' e ... ..... ';;! ~ t: "" c c t: "" ~ ... tt !:JI: ~ ~ ~ tt = ~ I-a: ~ c c $: c <" ... ... ... .. J> ... ('I Q -{ '-\ ~ 0 ( ( ~ €' Water: State is.Jikely~to!app.eal( ~ rUlijg to·COlofcido Supreme court .. . ~ Coatinued rr0m 5.A Il'rlgat1on Co., and c.tttes such 118 Denver, toldtboseruleswercwrong.It'sahellofa Bcmlder, EniJ.ewoo<1 and Highlands M1Yto nm the state. Th1S UI a total break· HaD.ch, which. al.so rely on the South downinpUbllcpollcy.n Platte, have !ought ror the peat year to The state llkel:yv.1ll appeal the ruling to-stop the pumptn(. · the Colorado supreme Court and iS al-Th~want the tanners to demonstnite .ready dnl1'ttnr emergmey lei!Sl&tion to in water court that they are putting keep the wells pumping next sprillg, . eno\12h water back into the river to re- Ament aai~. . place what their underground~ have But a Bupreme court rulint could take depleted. . months to· an1ve, and apponents said "Those tamiers have been eett1Di spe- they wm ft£llt 1UIY attempts by iawmak-. clal treatment tL'om the state tor years,w ers to~ out the farmer& Shimmin sa1d. !'Tim ruling J:neans we all No one wants to d?1 up farms, said havetopll;iybythesamerules.' ·14lke Sb1J:nmin, an attomeynpresentin( Ani.en.t sa1d. be hoped to brinit all the ~~ md pow.r!Ul irrigators akmg the partiestO(etherincomingweekstobam- SouthPiatte. . . . nirr out a compromlae that 't9iil liat1sn' ; .. "But they've bad 30 yeani to fix thla the c1t1ee and~ irrigation companie.s, . : probleIJi.. We begged. the state ;!or the aawellauDowthetarmerstokeeppump- ~ ye&!to come up with a coi:nPromise. ing. . · • B~~ they made it clear we would have to .. We an need to be s1ttlni around ~ a take them to court, and now .. we have conference room. not a courtroom,r won,.''. . ·.:: · Ament said "I!wedau't~awaytoprc- ~e lei&l battle. which flai'ed durttlg vent these kinds of water wars, the farm· the droil&'ht th1a summer; centers on ers Will have to sell their water to the cit· whether the state has all~cff~ to 1es beca.~ they won't be able to farm pump too much watcrtrom uncfei-ground anymore, 8Dd tbat will tear Colorado's ar- supplles, gradually depleting the South rtculture economy down.• Platte'' own undel'i?'OUnd soun:e.s. In1luent1al irrigation compamea. such mrlthJ@.RoekllMOuntainNc:wi.com as BIJou Itrtgatlon CO. and Fort ~ or(303)892-5474 --"--------------·---__ .,.,... ___ _ /' ··•. ·Court tells . ' .·farmers ·to shutoff spigots • tl}4-"f/o"l, Inigators inJam . . as ruling pits citie8 against growers ByJ~Smitb ROCKY MOUNTAIN Nl::WS . MON than 1,500 farms alODi the South Platte River ha-.e lost :·<::::'. :· '.. the legal authOritY to pump from wens that lJ:rlgate a broad swath ·· .·.-'·:\':' of northeastern Colondo farm- land from Brighton to Gr.eeley. . ' In a water court ~ is.siled th.13 week. the state was found to have no authority to appl'O\le the operations of-ftome ~.oo.o 1nig'a· tion wells, which .use~ much wa- . terinasummer88thetit;yatDen- . verl.1$eslnayear. · The .ea.se pitted the 1'&l'mers Q&'Q1nSt Front .Range; cttles and major trrlgation companies.· The ruling could Initiate the tJrst wa- . terwarot200S. · "If those tanners can't ~p . next year, this will mean billlom or <10nars in ruunage to the rarm economi," said Agricultt.lre Com-· JXll.iSle>ner Don Ament. 'Tm al- ready getting eallA from ~ and seed companies who don't knOW wbat to do. Thia ~ de· stroy that tarm economy tt we don't!!.nd a solution." In h1S rullng, 9olorado Districi court Judge Jonathan Hays said . . . .. . " •' tllt state dOes not have the au- tborityto approve the well ope{a- tions. somethini State Engineer Hal SimPSOnhaB done forycar&. Slmp.son could not ~e .reached tor comment. . · Without the state's authorlza· tiOn, the farmers wW have to iO to water court t.o ¢;their well aper~ ' atiom approved :ind likely wm have to buy more water to J~ theiruse o~wells. ~~·s some-. · , thing moist tanners c~ t a.trord, Ament and othm sai~.: · "'The growen up " hen: are scared to death." slil.tcl Tom ·:;ecn. . dlreCtor of the Central "."1orado con.servancy District. wbich rep- resents some of the timners aaec:t- cd bythe ru11ng. "Th~c beenM· lowing the rules leid out by the · · · state for years. No,.g tbeY'~ ~ , .. ·.' '1 '•I ••· ,_,r. -'-': •Fllv "-·~iiA~-~ ........ Po'verful lawmaker will fight for right to pump '~ter ByJerd~ ROCl<rMOUNT~N HE 'IJS one of Colorado's most powerful lswmakers vowed l\olondl\l' to do ev- erything ln his power to keep tbou- unds of tniptlo11 wels pumping and tile ranrfeoonom.v or the East- ern Plain& alive thJ.s sprtng in the .fttce of a major ll!.J'm wster crlsl.s. 'I'll 0,-ht Denver, I'll.llgbt otber cit- ies, 111.11,gbt the dJtch companles,1'11' change the state Constitution if I have to, t.o protect th~ farmers and keel:J those wells pumplng. •said Sen. Dave owen, R-Greeley, chair- man ~r the legl&lature's Jq1n.t Bud- get Committee, "'hlch cont.rols all state spending, as well as the Sen- ateAJ>proprlaUons Committee. . Owen's remarks comejust~sef­ ter Colorado Dl&tr1ct Court .Judge Jonathan HI.I.vs rulea agaln&t the state, oaytng state water omclah had no autlxlrlt)• lo IJV'ef&ee the oper- aUon or more UWJ s,ooo ird;stion ;·.< .... !. ~·-._£.;~-.(),~~\:.~ .·:·l "°:_:l._7,_P. ·----·--··: -·----------, -.. --·--------·------·--· ---rvESDAY;:oBCEMBEK ~ 2002 i. i:" HI l If 'II " I : .......... : ... 'b' -. . . ! .. _. --·-1 . . : • . : •• '.•=> .. !>:.1 · I I -~ !_; j I l ll : _. .. .. -.... , ht . 'ks ~f • r " • • e1g · ·· ·at ,. · · .armers "I'll fight Denver, I'll fight other cities, I'll fight the ~tch companies, rn c~nge the state . Constitution ifl have to, to protect those farmers and keep those wells pwnping." wells. The ru1lnc means that wlth· out lawmakers' intervention, more tbe.n 1,600 fanns llloni the South Piatte River won't be able to l.n1ga\.e thl.s spring. The state ls expected to appelll that ruling to the Colorado su- preme Q>wt. The appeal could be filed as earbr es tod~. aald Steve Sims, assistant attorney gt?n.eral At issue lB whether deep lrrlgatlon wells In the South Platte Basln oortbe38t of Den\ecr bave been pumping too much water, drying up · the SOuih Platte and k\)urlng fann- ens·and cities who rely oo. Ute rtverkr sel!. . The lssue has been simmering ror more than 30 year.s, but the SOUUi Platte ha& had su.ch ab1D1dant wat.er that R!W cr1tk3 belleYed cllil.N ~ .. c, ·. -.~ - ··-!• .. ;.-... : I .. ' Sen.Daw<>wm R-Greeley being slgnlfkantly harmed by the PumJ11ng. That chanr;ed quickly t.hls swn- mer. A& a hi.stone droulht lowered water levels In the South PW.te, a number ot cities. as well as po~ cUtch companles threatened to seek anl.I%Junctlontostopt.h.epre..cUce . Water wers lncludlni the power- 1\J.l Bllou lrrlg&Uon Oo., the Fort Mor· gan Ditch co . and the FarJI)ers Res- ervoir and rrngatknr Co., 88 well as the communities of Boulder, West- min.ster, lllgblands Ranch, Thorn- ton and Denver, farmally opposed the state ln an admlnlstratlve pro- ceeding 1n water court. Last week the cOlll't decided against Ule' state and the pumping farmers, throwing into doubt the fllnrlers' legal rlghtto !.rd&Ble this sprinK . Experts believe these Irrigation ""Cll8 use as much watertn one sum-· mer as Denver use.s: in a year, more than 300,000 acre-teet. An acre-foot ls enough to suppl.v a !am.Uy of lhur- wttb waCer ror one ,ear. The ditch oompan1es and t.h.e clt- le& 98,f the,y don't want the r.ann& to go dry. But they wunt the we.I.er court, not statewaterofftdals, tode- termine how much water the wells can pump and hO" much water must be returned to the South Platte. The controversy h& tanner.s, their bankers and stat.e aRJ1culture otnclals deeply •Ranted. In the late 193(!B , after the Du.stBowl wiped out bundredsof!anns, thestateencour- aged drilllng ofth~e deep lnigaUon wells because the wells made broad swaths ortannland almost drought- prool. But bytb.e l 96Ds, bydrologlstsdls- covered that the wells actu&u_v de- pleted tbe dver by draining under- ground supple& that · helped the South Platte malntaln lUI 00\\lll. Since tben, fumer.s have been re- qulrecl by the state to put. water · back Into I.he rl.ver to omset l.h.elr pum_plng. -. _Buteltles and fllrnler& who rely on the river have never believed these ~ .- => . ·. ·: ·:. .. .:·:.~:, J ;;; -.· :~t, : ~ ,} :: ~-~:-~~J ~ ; 'f ··=, ~ .. :· ·.-.·. -~- tanners put enough water back Into tberlveT. Andthoughmoatwat.erus- ers have to gtJ through ·an arduous water-court review to use \\'!lter, these Dinners haw simptr worlced- wltb stat.e oMclals, not the court, to detennlne how much water I& pumped amt bow mueh ls given backtotbt'river. The '88ue blmv up thLs l!WtlIIler as farmers with senJor Wilt.er rifbts on the river watched their l'ields burn while farmers wlth inigatlon wells continued pumplog". .Fanners, water olllciah and I.aw- . makera·are ;holding a. series or emer- gency meetlngs ~ seeila leg13latlve solution can be crafted. The Colo- rado legislature convenes Jan. 8.. Owen saJd he hoped to come up with a bill th.et will reo..ssurn the ditch compen.ies and cl.ties that the water Is bemg med equltnbly, nnd that wlll allO\\• the lannera to plant and l.rrlpte next-sprtng-. "I'm not s e.rtng-yet what we're ru- ing to do because rm still taJklni to people," Owen said. LJlut In early .TBll.U8l'J you will see -a b1ll that Js as eqWtable as ):IC>&Slble to everyone in- volved .~ smftli,l@FD::l:l}lll'~eu:r.com or(JOJJB!/2-5474 N c c c. c t-" '-c N ; c c Q: c "" ... ~ c.: c c.: (.> N 0: N 0: N .. ~ I- I- 2 s; '= ::Ii c c '= ::Ii ;... ...., 1:1'. :it i i i 1:1'. = OI .... <D =lll 0 0 j;l c: <1 ..... .... ..... <1 ..... <D 0'1 !!! c c N '-c c N ., '> ·~ '"··.• .,.. ·'< ~ .. , ...... , "_.,_ , !'. e ,,;,';-<?~>· .• 1. "t'.,· .~· ..... ,;.,_;-_-;-.. ..f-.•'-'··-·,.-, ·'"· ,. ~..-•·'~""·"'-",... , .. ·'·~·,,· •. :., • '·· ,. WP~SDAY, J~UARY l, "2()()3 .., < (..:. ··"'· ••. -~ ~(":. ~ •.•• •'t • • .... ,.. ..... l '"· ~F ~· ......... ·..... ... ... .. ~ ., .. ! ..... ~ .... -"' • •"> • : ,/ I 1,,· , c-· \ •• ' ... ,.. :'I. -_,_. (;· -·' .,_ ... ~ ~~ ,': • ~-._; -"~f ;=·;. ·"t\ ~ ~ -~··:-r. -.1" -~ ~~ ·,-~ ~J ·:!. .... P'-r".-l . ! ·T "·-~ -~-~<· -~' 't' , ... , ,. :{ l•. "'"~· .. ·. ·"i '; ~ .. ·:. <.; ·'· ~ .\ " , •. : j --S81iiif ~~appwi111liil~t; ·; ·ru ·l i ng Attorney general ! stands up for farms ' that depend · on wells By Jerd Smith ROCKY MOUNTAIN NEWS j ColoradoJs attorney general has I appealed a water court rullng that I renders ongoing pumping df more · than 3,000 irrtgation wells in north- eastern Colorado illegal. Ken Salazar said he would ask ' the state supreme court to expedite its review of the case. The soonest it's likely to be heard is May, according to Ken Lane, a : ... spokesman for the attorney gener- al's office. Tuesday's appeal comes one week after Colorado District Court Judge Jonathan Hays. who pre- sides over Pivislon One water court in Greeley, said the state had no au- thority to administer thousands of irrigation wells in the South Platte River. At issue Ls whether the wells have pumped too mu.ch water over the . years, gradually depleting the South-Plat.te and reducing supplies because of powerful ditch compa- nies and some cities. The ruling means more than 1,500 fanns along the South Platte probably won't be able to irrigate thousands of acres of crop land this sp~g. Several Front Range cities, in- cluding Highlands Ranch. Denver, · Boulder, Thornton and Westintn- ster, as well as the Fort Morgan Irri-· gation Co. and the Bijou Irrigation Co., challenged the wells' operation thls year. spurred by the drought and growing-Water shortages. Lawmakers, including Joint Bud- get Chairman Sen. Dave Owen, R-Greeley, plan to propose emer- gency legislation ·that will allow the farmers to plant crops and irrigate this spring while the case ls being re- viewed by the Supreme Court. "The viability of agriculture Ln the South Platte Rlver Basin has been placed in jeopardy by the water court's ruling and it 18 essential th~t the state ~f~~ contest it, Salazar said. . ... -~ '1i - "" 0 0 <:.> 0 ..... ...... 0 (..) ~ ..... 0 U:> 0 <:.> ~ (..) 0 (..) (JI "" a "" a ...., "'" § ..... z ~ =:I!! 0 g § "' .j. .j. .j. t1l = ~ ..... <D ~ 0 0 ~ c:: .... ..... ..... ..... .... ..... <D O'I 1§1 0 0 ...., ...... 0 0 ...., ! :J ~ .r l 'I 200 2 11 /11 MON 15 :46 FAX 3035262624 HARTIN AND WOOD WATER 444 Englewood Utilities ~002/002 'i '• .... . . .. . . ·' I .. ~ . ·' . •' · i.rlC c.c;. c~~=. · ·: . · ... ·. ·. . ·.· ~H -= :L,d .. J .... ;c.1 ,~ .... •1·'"· "·--· .. _ •.•. I iriclay;N~ ft.:2002 I :ax: I ' • . -. . . . . . . "VoL w,·No.43 • ~p~·· .u~ .. ' ........ '.~·: .... · . . ·. . . . .. . ' ... • ; .... ~ ": -.~ ........ ,,. _.. ., -... ~ ~ , _..,...:· '·. :::~~~." .•. The Denver Post I Brian Brainerd Five-year-old Justas Mikulskis and his father, Gint, ice fish Tuesday at Chatfield Reservoir. Some nearby residents contend that Denver Water's plan to tap t he lake for drinking water will expose them to decades-old contamination, but officials insist the water is safe. Plans to tap Chatfield water raise taint fears Residents cite nearby Superfund sit~ By Joey Bunch Denve r Post En vironm ent Write r A plan to pull drinking water from Chatfield Reservoir early next year ignores history arid pub- lic health, contend activists who say the water was tainted by rock- et fuel and industrial chemicals de- cades ago . "It's like building houses on Rocky Flats," said Candace Logue , referring to the former nuclear ·weapons factory north of Denver. Logue is convinced the water she drank in the early 1980s killed her newborn son , Michael , in 1984 and left her next child, Kimberly , with a wrecked immune system. Despite a stack of government studies that say the Denver Water supply from the region is . safe, Logue and a handful of other activ- ists and former residents of the community are unswayed and wor- ried . The reservoir in Jefferson Coun- ty shares creeks and underground water supplies with a Superfund cleanup site -tbe neighboring U:S. Air Force Titan Missile test- ing ground. Some residents like the Logues say they may have already drank pollutants from the site. Until it closed in 1984, the Kassler Water Treatment Plant be- tween the reservoir and t he testing site handled whatever came down- . stream -·from the rocket facilit y : and eventually put it in the dri.Dk- ing supply, critics say. Since Kassler closed, the runoff from the testing site has .either stayed in the soil and groundwater or passed through the reservoir. • Denver Water will begin tapping the reservoir, for the first time,,iJ! February to boost the city's drin;k~ ing-water supply. · Further, the state and the u.s ; ·Army Corps · of Engineers ?te spending $2 .5 million to study fil1~ possibility of doubling the amoqnt of water in Chatfield to help quench the region 's thirst during fu; ture droughts. ~ ..,. Ch.atfield Reservoir, built in t~ mid•l960s for flood prevention, to- day is enjoyed by 1.5 million visi- tors a year. The 1,450-acre lake at; · tracts swimmers, boaters, anglers, hikers, campers and wildlife watC!i.- ers. :-. A few miles away , the military is still cleaning up the contamina: tion t hat put the site on the list of the nation's most polluted places in 1989 . ·''' The site was contaminated with spent rocket fuels sprayed off ef!~ gine test sites, cleaning solve!}fs and other industrial oils and wast~. They left behind residues of Uy· drazine , nitrosodimethylamine; trichloroethylene, benzene and ., ""'. Please see WATER on 4S The Denver Post I Brian Brainerd Canada geese have replaced boaters on frozen Chatfield Reservoir for the winter. Denver Water and state health department experts say that even if some contaminants made it to the r?servoir, they are long gone by now. Plans to tap Chatfield water opposed WATER from Page 1 B heavy metals. But studies by the state health department and the EPA and the military, among others, say the chemicals never made it off the testing site and the 4, 700-acre in- dustrial complex owned by de- fense contractor Martin Marietta Corp . Studies also have given a clean bill of health to the water in near- by Chatfield and the South Platte River. Logue , however, remains con- vinced the water is unsafe . ''How many children have to die before they think about it?" Logue said. About 30 families among the 2,400 people who lived in the two subdivisions in the early 1980s said they believed cancers, birth defects and other illnesses in chil- dren were caused by their tap wa- ter. But a lawsuit filed by the Logues and 10 other families in the Friendly Hills and Harriman Park neighborhoods was tossed out in 1990 for lack of a strong link between the testing site's pol- lution and the illnesses. Denver Water and state health department experts say that even if contamination had made it to Chatfield Reservoir, it's long gone now. "There is no written evidence and there is no logical likelihood that anything is there," said Steve Work, Denver Water's director of operations . "Agencies with a lot more expertise than we have have concluded that on many, many occasions." The federal government sold the 464-acre testing site to neigh- boring defense contractor Lock- heed Martin last year, but the Air Force remains responsible for on- going cleanup of the contaminat- ed dirt and water there. Karl Kunas, the environmental engineer overseeing the Air Force cleanup the past five years, said the military continual- ly monitors water on the site with the state health department, the U.S. Environmental Protec- tion Agency and a local citizens advisory board looking over its shoulder. Adrienne Anderson , a Colorado University instructor and grass- I ;;;J..-.;i.' -C ~ ___ _.........,. - roots environmental organizer, has no faith in the government's studies or reassurances. She went door to door in Friend- ly Hills collecting data on illness- es in the early 1980s as the west- ern regional director of the Na- tional Campaign against Toxic Hazards. State and federal studies paint- ed the Air Force and the defense contractor in the best possible light by ignoring contradictory in- dependent investigations, includ- ing hers, Anderson said. She accuses the government of skewering the facts that would prove a dire public health threat. "They very well know what the impacts were , but they rigged these studies to cloud the history of contamination in this water all the way back to 1956 ," when the rocket plant opened , she said. Logue said the studies are a carry-over of the Cold War secre- cy . "They kept it all secret back then, so why shou ld we trust them now?" she said. Not all environmentalists are convinced that drinking from Chatfield poses a threat. Myrna Poticha, who serves on the South Platte River Commis- sion and sat on the state Water Quality Control Commission from 1975 to 1985, is an ardent member of the Sierra Club and a staunch defender of healthy wa- ter. "The last (water inspection) numbers I saw on Chatfield shows that it's so clean it's unbe- lievable," said Poticha, who was named one of the America's 30 "clean water heroes" by the na- tional Clean Water Network in October. Carmi McLean, Colorado direc- tor of the Environmental De- fense's Clean Water Action orga- nization, said she wasn't alarmed by Chatfield as a drinking-water supply, but the lingering issue about t:ie Air Force plant's im- pact should be put to rest in the public's minds. "I don't want to cry Chicken Little, but absolutely, given the concerns with (the rocket plant) through the years about contami- nants going into the water sup- ply, Denver Water should be as prudent as possible ," she said. ... 2 ,)Q.2 12119 THU 11 :33 FAX 3035262624 MARTI N AND WOOD WATER ......... Englewood Utilities ~002 /004 DRAFT' ATT 7 159 .1 EiC Ioc Tom Wood/Martin and Wood Water Com1ullant3. Inc. 12118 An Executive Summary of the Pending Englewood/Centennial "Water Supply and Facilities Agreement" Description of the Present 1980 Water Supply Agreement The 1980 agreement contained two primary features, both of which led to conflict between Englewood and Centennial, and both of which are addressed and resolved in the pending agreement. First, the 1980 agreement provided that Englewood would provide Centennial with 1,500 a.ere-feet each· yeM of high-priced scheduled water, to be delivered to ,.~enten~ial on a set or scheduled monthly basis. Then , to the extent that Englewood ·had water available for Centennial in excess of the various amounts of monthly scheduled water. Englewood would deliver additional water Ccalle4 unscheduled water) . to Cc~tC:nnial at a lower price. Conflicts developed between the parties as to · whether ~e I ,500 acre-feet of scheduled water was an absolutely firm, guaranteed supply for Centennial. Second , the 1980 agreement provided that Englewood would utilize 900 acre- feet o( Englewood's storage capacity in McLellan Reservoir so as w · provide herself wit}) the ability to firm up the deli very to Centennial of the 1,.500 acre-feet of scheduled water. The conflict which arose here was Centennial's contention that Englewood had effectively lease:d these 900 acre-feet of storage capacity for Centennial ' s exclusive use, i.e., that ·these 900 acre-feet of storage space were for Centennial to store its own water. A Cqmparison of the Primary features of the 1980 Amement and the Pending Aueement The pending agreement will do away with the 1,500 acre-feet of scheduled wa~· apd the 3,~00 acre-feet of unscheduled water, and it does nQt require Englewood to ·deliver any set amount of water to Centennial in any year , Thus, the pending a~eernent does away with any notion that En~lewood is to provide Centennial with a .firm'·supp~y of water. Rather, the pending agreement requires Englewood at all times to determin e if she has a water supply smplus to her own needs, and if she has such surplus , to make it available under certain terms to Centennial . ~.The pending agreement sets up a three-tiered price for the water to be supplied to Centennial -high priced water , medium priced water, and low priced water. Within cc~. mortthly limits on how much water Centennial is required to take and pay for, Centerinial must take all high and medium priced water offered . by Englewood . Centennial is under no obligation to take or pay for low priced water. Beginning in the 2002 12 /19 THU 11:34 FAX 3035262624 HARTIN AND WOOD WATER 444 Englewood Utilities 159 .1 EiC Joe Tom Wood/M11rtin and Wood Wo.tcr Cons11ltants, Ini.:. 12/18 year 2003, high, me.dium and low priced water will be sold to Centennial at $337, $175, and $99 per acre-foot, respectively, escalated annually on the basis of a Consumer Price Index ("CPI"). As to the 900 acre-feet of storage previously in conflict, Englewood will annually lease it to Centennial, for Centennial's exclusive use, for $233,.500 in 2003, escalated annually by the CPI. Further, the pending agreement includes Englewood 1 s express annual lease to Centennial of her surplus fl.ow capacity in the City Ditch and in the Nevada Ditch. Englewood will receive from Centennial $35,000 in 2003, escalated annually by the CPI.· In addition, Englewood's surplus capacity which is le.ase.d to Centennial is set forth clearly in the pending agreement, which will avoid another conflict stemming from the 1980 agreement. , . , . . . 1 ~ J,J1 (,t \,,n.v/,j..tp ~ The Two Principal and Interrated Features of the Pending Agreement The pending agreement is a performance based agreement whereby Englewood is r~warded by her good performance in providing her surplus water supply to Centennial . As long as Englewood continues to supply a "good" amount of water to Centennial on an annual basis, Centennial will pay Englewood more money for the high and medium priced water. If Englewood's delivery to Centennial falls in a given year, as compared to the last ten years, Englewood will be paid less for high priced water for · the next ten years. This explanation is admittedly incomplete, althouah generally accurate, as il fails Lo include the following explanation of the two primary and -~tcx~ features of the pending agreement. These two features are termed the res old and the Threshold Buffer. The Threshold represents the maximum annual amount of high priced water to be sold to Centennial. It is calcu lated early in January of each year for the forthcoming year, based on previous years' delivery of water to Centennial. The Threshold is , however, initially set at 1,500 acre-feet for the year 2003. The Threshold may increase only if the minimum annual delivery for the preceding ten years exceeds the previous year's Threshold, and, if so, the new Threshold for the current year will become the minimum annual delivery from the previous ten years. In other words, Englewood will be rewarded for her performance by increasing the current year's Threshold (i.e., the limit for the high priced water), if she builds up a good record of delivery for the past ten years. The Threshold can also be reduced if Englewood fails over a period of Lime to provide water to Centennial, but the Threshold Buffer is provided in order to minimize or slow down a reduction of the Threshold. ~003 /004 ~002 12 /19 THU 11 :34 FAX 3035262624 MARTIN AND WOOD WATER ~~~ Englewood Utilities 1S9.1 EiC Joe Tom Wootl/Martin and Woo<l Wartt COftllllt4nta, Inc. 12/18 The Threshold Ruffer stems from the 1980 agreement. It is, in fact, an imai:inazy 900 acre-feet of storage capacity in Mclellan Reservoir which is used t.o minimize or at least slow down any reduction t.o the Threshold. It works as follows. ~004 /004 At the initiation of the agreement, presumably January, 2003, the .amount of water in the imaginary 900 acre-feet of storage in McLellan Reservoir, i.e., the amount . · of water in the Threshold Buffer, is set at zero. To me extent that Englewood delivers - to Centennial an amount of water in excess of the Threshold in any year, that excess is deemed to be stored in the Threshold Buffer. For example, wilh the year 2003 threshold of 1,500 acre-feet, if Englewood were to delivery Centennial 2,000 acre-feet in 2()93, at the end of 2003, the amount of water in the Threshold Buffer would be 500 acre-feet. The amount of water in the Threshold Buffer is capped at 900 acre-feet so that it acts just like a reservoir with only 900 acre-feet of space. If Englewood in 2004 then delivered to Centennial 600 acre-feet more than the .2004 Threshold, at the end of 2004, the Threshold Buffer would have 900 acre-feet in it (500 from 2003 plus 600 from 2004 = l, 100, but the cap is 900). :.: Now we know how the Threshold Buffer can be increased, but how does it ininimize or slow down a reduction to the Threshold? Let's continue the progression above from 2003 and 2004 to the year 2005. 7 ./" --- If the Threshold for 2005 were~ acre-feet, but Englewood only delivered 1,100 acre-teet in 2005, 600 acre-feet in the Threshold Buffer would be used-to prevent a re.duction in the Threshold for the next year, i.e. for 2006. However, after the 600 acre-feet from the Threshold Buffer were taken in 2005, the Threshold Buffer would be reduced to 300 acre-feet for the~· 2006, but perhaps more importantly, the . Threshold for 2006 would remain at ,600-ere-feet . .. ,_·i- If the year 2006 were a "good" year, ~ith delivery exceeding the year 2006 . threshold, the amount in the Threshold Buffer would increase toward or even to the 900 acre-foot cap. If the year 2006 were a ''bad" year, there would still be 300 acre-feet in · the Threshold Buffer to prevent or at least minimize a reduction in the Threshold in " 2007. However, whenever there is an insufficient amount in the Threshold Buffer to · cover the deficit between last year's delivery and last year's threshold, the Threshold · for the next year will be reduced. It must be noted, and iL must be understood, that if a redu9pon in the Threshold does occur, this re.duced threshold will remain for the next · ~n years. This providci Englewood with a great incentive to maximize the supply which she provides to Centennial. · ""' ·r These primary provisions of the pending agreement reward Englewood for a continuation of her good performance while providing fairness to Centennial for Englewood's lack of g~ performance. WATER SUPPLY AND FACILITIES AGREEMENT TABLE OF CONTENTS 1. Recitals 2 . Prior Agreements Revoked 3. Sale and Purchase of Water 3.1 Sale and Purchase 3 .2 Definition of Surplus Water 3.3 No Englewood Obligation to Change Water Rights or Construct Facilities 4 . Availability of Surplus Water; Compliance With Charter; Right to Settle Litigation 4 .1 Availability of Surplus Water 4 .2 Englewood Charter 4.3 Englewood 's Right to Settle Litigation 5 Englewood to Make Good Faith Efforts to Supply Surplus Water 6. Non-liability of Englewood for Monetary Damages; No Quality Wananty 7 . Areas to be Served 7 .1 Centennial Service Area 7.2 No Violation of Englewood Decrees 7 .3 No Liability to Third Parties Within Centennial Service Area 7.4 No Liability Outside Centennial Service Area 8. Pricing of Water 8 .1 Introduction to Pricing of Water 8 .2 Definition of Terms 8.2 .1 Offered Water 8 .2 .2 Delivered Water 8.2.3 Obligated Water 8.2.4 Untaken Water 8.2.5 Contract Water 8.2.6 Annual Contract Water 8 .2 .7 Threshold 8.2.8 Ten-Year Average 8 .3 Allocation of Surplus Water to Categories 8.4 Calculation of Threshold During Threshold Initiation Period 8.4.1 Calculation of Threshold P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 8.4.2 Refund of Payments During the Threshold Initiation Period 8.5 Calculation of Threshold After Threshold Initiation Period 8.5. J Definition of Additional Terms 8.5.2 Calculation of the Threshold 8.5.3 No Change in Threshold 8.5.4 Reduction in Threshold 8.5.5 Increase in Threshold 8.6 Single-Use Water and Reusable Water 8.7 Purchase Price for Water 8.7. J High-Priced Water 8.7.2 Medium-Priced Water 8.7.3 Low-Priced Water 8.7.4 Reuse Rights 8.8 Example Calculation 9. Centennial Payment Obligations 9.1 Payment for Obligated Water 9.1.J Monthly Limits on Amounts of Obligated Water 9.1.2 Delivery Rate Limits 9.2 Payment for Non-Obligated Water 10. Place and Measurement of Deliveries; Pumping Costs; Notification 10.1 Place of Delivery and Measurement 10.2 Pumping Costs 10.2. J City Ditch Pump Station 10.2.2 South Platte Reservoir Pump Station 10.3 Notification by Englewood of Amounts Available for Delivery, Response by Centennial 10.3 .1 Operational Notice 10 .3.2 Planning Notice 11 . Measurement Devices, Recordkeeping , Billing and Payment 11. l Centennial Measurement Devices and Recordkeeping 11.2 Englewood Measurement Devices and Recordkeeping 11.3 Annual Accounting and Calculations 11.4 Reconciliation , Billing and Payment 12. Amendments to 1977 Ranch Creek Lease 13 . Physical Facilities Lease P :ldianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc ii 13. l Grant of Lease 13.2 Englewood Physical Facilities in Which Capacity Is Leased to Centennial: Use of Same 13.3 McLellan Reservoir 13 .3. l Determination of Capacity of McLellan Reservoir 13 .3.2 No Reduction in Payment Due to Siltation 13 .3 .3 Removal of Silt , or other Restoration of Capacity , Performed by Englewood 13.3.4 Removal of Silt by Centennial 13.3.5 Reduction in Storage Capacity by Causes Other Than Siltation 13.3.6 Drainage for Operations or Repairs 13.3.7 Losses from Seepage, Evaporation, Failure of Facilities and the Like 13.3.8 Storage By Either Party in Capacity of Other Party 13.3.9 Addition of Substances to McLellan Reservoir 13.3.9.1 13.3.9.2 13.3.9.3 Coordination Permits Recommended Practices 13.3.9.4 Fines , Damages , Fees 13.3 .10 No Effluent Directly Into City Ditch or McLellan Reservoir 13.3.11 Records , Accounting 13.3.12 Lease Payment for Use of McLellan Reservoir Capacity 13.4 City Ditch Facilities 13.4.1 Determination of Capacity 13.4.2 Existing City Ditch Agreements with Third Parties 13.4.3 Priority to Use of Capacity in City Ditch Facilities 13.4.3 .l City Ditch Water Rights and Englewood Reversionary Capacity 13.4.3.2 Englewood's Boreas Pass No. 2 Ditch Water Right 13.4.3.3 1948 McLellan Reservoir Storage Right 13.4.3.4 13.4.3 .5 Paid Deliveries Water Other Englewood Water Rights and Contract Water 13.4.3 .6 Centennial Water Rights and Contract Water 13.4.4 Englewood Not to Make Additional Transfers of Capacity In City Ditch Facilities 13.5 Nevada Ditch 13 .5. l Nevada Ditch By Laws and Englewood Capacity 13.5 .2 Englewood Not to Make Additional Transfers of Capacity In Nevada Ditch P :\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc iii 13.6 Englewood's Nevada Ditch Capacity Delivered at City Ditch 13 .7 Lease Payment for Use of Capacity in City Ditch Facilities and in Nevada Ditch 13.8 Payment of Annual Operation and Maintenance Costs as Additional Lease Payment 13.8. l City Ditch Operation and Maintenance Costs 13.8.2 City Ditch Pump Station and Pipeline to McLellan Reservoir and Discharge Facilities from McLellan Reservoir to the South Platte River Operation and Maintenance Costs 13.8.3 City Ditch Pump Station Electrical Pumping Costs 13.8.4 Nevada Ditch 13.8.5 Billing and Payment 13.9 Control of Operations 13.10 Timeliness of Repairs 14 . Grant of Easements to Centennial 14. l Specific Instrument 14.2 Locations 14.3 Te1m and Type 14.4 Purpose and Scope 14.5 Route Selection 14.6 Reasonable Standards 14.7 Limitation on Obligation to Grant 14.8 Limitation on Locations and Standards Selections 14 .9 Englewood Relocation and Reconstruction 14.10 Exclusions 15. Englewood's Option to Pai1icipate in the Construction and Use of New Centennial Facilities 15 .l Notifications 15.2 Design and Englewood Participation 15.3 Englewood Payments 16. Capital Improvements to City Ditch Facilities 16.l Improvements to City Ditch and/or Englewood City Ditch Pump Station 16.2 Separate New Facilities on City Ditch 17. Capital Improvements to Nevada Ditch Facilities 18. Adjustment of Payments 18 . J CPI Basis for Adjustments P :\d ianas\AGM TS \2003Wa terFacilitiesSupplyAgreement.doc iv 18 .2 Appraisal Basis for Adjustments 18 .3 Instructions to Appraiser(s) 18.3. l Storage Capacity in McLellan Reservoir 18 .3 .2 High -Priced Water 18 .3.3 Medium-Priced Water 18 .3 .4 Low -Priced Water 18 .3.5 Reuse Rights 18 .3.6 Paid Deliveries Water 18 .3.7 Lease of Facilities J 9. Centennial Right of First Refusal to Purchase Englewood Water Rights or Raw Water Facilities 19 .1 Englewood Raw Water Facilities 19 .2 Procedures 20 . Mutual Cooperation 21 . Reversion of Leased Water to Englewood 22 . Default and Remedies 23. Notices 24. Assignment by Either Pa1ty 25. Binding Effect 26. No Third Party Beneficiaries 27. Entire Agreement 28. Modifications in Writing 29. Severability 30. Applicable Law 31. Headings and Captions for Convenience 32 . Term and Renewals of Agreement 32.1 Term of Agreement 32.2 Initial Term 32.3 Renewal Options 32.4 Procedures for Renewal 33. Condemnation 34. Counterpaits P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc v LIST OF EXHIBITS Exhibit A Payments Due from Centennial to Englewood Exhibit B Outside Ci ty of Englewood Water Service Areas Exhibit C Centennial Service Area Exhibit D Example Calculation Exhibit E Water Delivery Measurement Points Exhibit F General Features Exhibit G 1995 Englewood/Cyprus/Denver Agreement Paragraph 3.3.5 Exhibit H Englewood Physical Facilities in which Capacity is Leased to Centenni al Exhibit I Agreement between Englewood and Denver dated October 3, 1995 Exhibit J Agreement between Denver and Littleton Cemetery Association dated May 23, 1933 P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc vi WATER SUPPLY AND FACILITIES AGREEMENT This Water Supply and Facilities Agreement ("Agreement") is made effective this 151 day of January, 2003 , between the City of Englewood, a municipal corporation under the laws of the State of Colorado ("Englewood "), and Centennial Water and Sanitation District, a quasi- municipal corporation under the laws of the State of Colorado ("Centennial"). 1. Recitals. 1.1 Englewood and Mission Viejo Company , a California corporation ("Mission") entered into an agreement dated November 3 , 1980, entitled Water Supply Agreement (Englewood-Highlands Ranch) ("Water Supply Agreement"). Mission 's rights and obligations under the Water Supply Agreement were subsequently transferred to Centennial. The Water Supply Agreement, in general, provides for the sale of water by Englewood to Centennial, and various ancillary and related matters. 1.2 Englewood and Centennial are also parties to a Memorandum of Understanding dated May 24 , 1990, a second Memorandum of Understanding dated June 7, 1990 and an Englewood-Centennial Temporary Agreement dated January 5, 1998 (collectively, with the Water Supply Agreement, the "Prior Agreements"). 1.3 Englewood and Centennial desire to terminate the Prior Agreements, and to enter into this Agreement for the sale of water by Englewood to Centennial , the leasing of a portion of the capacity of certain Englewood water storage and delivery facilities to Centennial, and various ancillary and related matters. 1.4 Englewood and Centennial are also parties to a Water Lease and Management Agreement dated August 3, 1977 ("1977 Ranch Creek Lease") which was originally entered into between Englewood and the City of Thornton. Thornton subsequently assigned its interests therein to Centennial. Englewood and Centennial desire to amend paragraphs 21 and 22 of the 1977 Ranch Creek Lease. NOW, THEREFORE, in consideration of the premises and the mutual agreements and covenants hereinafter contained , the parties agree as follows: 2. Prior Agreements Revoked. As of the effective date, the Prior Agreements are revoked, and are of no further force or effect except for any payments from Centennial to Englewood which are presently due , which are listed on Exhibit A hereto, and except that there are presently _acre feet of water stored in the 15.15 percent of the storage capacity of McLellan Reservoir hereafter referred to, which water belongs to Centennial, and there are presently acre-feet of water stored in such 15.15 percent, which water belongs to Englewood. Englewood will withdraw its water therefrom as promptly as practical, and if Centennial has water which it can store in such 15.15 percent prior to the withdrawal of the P :\dianas\AGMTS\2 003WaterFacilitiesSupplyAgreement.doc 1 Englewood water, then to the extent of such Centennial water, the Englewood water shall be booked over to Centennial. 3. Sale and Purchase of Water. 3.1 Sale and Purchase. Englewood agrees to sell all of its Surplus Water to Centennial, and Centennial agrees to purchase some or all of that water from Englewood , under the terms and conditions set fo11h in this Agreement. The term "Surplus Water" is defined in paragraph 3.2. 3.2 Definition of Surplus Water. Surplus Water for purposes of this Agreement is that water available to Englewood under its decrees and contracts which, from time to time , exceeds the amount necessary for the needs of (1) water users within the municipal boundaries of Englewood, including those resulting from lands annexed into the municipal boundaries of Englewood after the date of this Agreement, (2) those persons, areas or entities other than Centennial which are served by Englewood on the date hereof, which are desc1ibed on Exhibit B hereto, and (3) those areas in the vicinity of Englewood's municipal boundaries to which Englewood elects to provide treated water; provided , however, that Englewood shall not sell treated water outside the Englewood municipal boundaries to a "wholesaler", i.e., Englewood shall not sell treated water outside its municipal boundaries to an entity which does not itself use the water but instead resells the water to the actual users. Periodically throughout each year ("year" in this Agreement means calendar year), Englewood shall determine how much, if any, Surplus Water it has available. 3.3 No Englewood Obli1rntion to Chan£e Water Rights or Construct Facilities. Nothing herein shall obligate Englewood to bring any proceeding to change any water right , or to build any delivery facility, or to construct any well. Centennial shall not include any Englewood water right in an application filed in water comt by Centennial without the prior written consent of Englewood, which may be withheld without cause. 4 . Availability of Surplus Water; Compliance With Charter; Right to Settle Liti£ation . 4.1 Availability of Surplus Water. Englewood has Surplus Water as of the date hereof, but may not have Surplus Water in the future if Englewood's population grows as anticipated, or if there is severe and protracted drought, or if other adverse circumstances develop. Centennial is given no assurance that Englewood will continue to have Surplus Water. Englewood shall have the 1ight , in its reasonable discretion, to interrupt , reduce or eliminate delivery of water to Centennial under this Agreement whenever and to the extent Englewood does not have Surplus Water. 4.2 Englewood Charter. This Agreement is subject to , and is made in conformance with, the provisions of the Englewood City Charter. The benefits and obligations P :\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 2 under this Agreement shall not be modified by any amendment hereafter made to the Englewood City Charter except as may otherwise be agreed to by Englewood and Centennial. 4.3 Englewood 's Right to Settle Litigation. Englewood shall have the right, in settlement of litigation , to commit by conveyance or otherwise minor amounts of the water available from any of its sources of water, and such commitment or conveyance shall not constitute a breach by Englewood of this Agreement. Neither shall a judicial determination which reduces the amount of water supplied to Centennial under this Agreement constitute a breach by Englewood of this Agreement. Englewood and Centennial each receive a fraction of the water derived from the 1948 McLellan Reservoir water storage right and from the "Basic Deliveries" and "Paid Deliveries" under the Settlement Agreement among Englewood , the City and County of Denver, acting by and through its Board of Water Commjssioners, and Cyprus Climax Metals Co. dated August 11 , 1995. If a commitment of water by Englewood from any of those three sources in settlement of litigation reduces the available water from the particular source, then the reduction shall be shared between Englewood and Centennial in the same propo11ions as the available water from that source is shared; i.e. the commitment shall reduce the total water available from the particular source, and the remaining water shall be shared according to the fraction otherwise established for allocation of water from that source. 5. Englewood to Make Good Faith Efforts to Supply Surplus Water. Englewood agrees to make good faith efforts to supply to Centennial , under the terms and conditions of this Agreement, that water which is Surplus Water as defined hereunder. 6. Non-liability of Englewood for Monetary Damages; No Quality Warranty. The parties recognize and agree that Englewood's ability to provide water to Centennial hereunder, and the quality of the water provided, are dependent upon numerous forces beyond Englewood 's control, such as, but not limited to , drought; flooding; fire; windstorm or other storm events; war; riot; deterioration, physical failure or inadequacy of storage or delivery facilities; adverse results of litigation ; changes in applicable constitutional provisions , statutes or regulations; available flows provided by the ditch outlet manifold from Chatfield Reservoir and associated piping; pollution; earthquake; and the like. Under no circumstances shall Englewood be liable to Centennial for monetary damages for 1) failure to deliver water to Centennial, 2) the quality of the water delivered to Centennial, or 3) failure, inadequacy or unavailability of any storage or delivery facilities, whether or not leased to Centennial by Englewood. Englewood makes no warranty, representation or other assurance of the quality of the water to be delivered to Centennial. The water delivered will be raw untreated water, and Centennial shall be responsible for such testing of quality and such treatment as it deems appropriate prior to delivering such water to its customers. 7. Areas to be Served. 7 .1 Centennial Service Area. Centennial ' s service area for purposes of this Agreement ("Centennial Service Area ") is shown on Exhibit C hereto. Absent Englewood 's prior written consent , which ma y be withheld in Englewood's sole discretion , Centennial shall P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 3 not deliver water supplied to Centennial by Englewood under this Agreement ("Englewood Water") outside the Centennial Service Area; provided , however, Englewood Water shall be deemed to be delivered entirely within the Centennial Service Area at any time when the daily demand for water within the Centennial Service Area is greater than the daily concurrent supply of Englewood Water. 7 .2 No Violation of Enelewood Decrees. Englewood shall deliver to Centennial hereunder only water that may lawfully be used within the Centennial Service Area. If water has been delivered to Centennial in compliance herewith, then Centennial shall be solely responsible for any violation or claimed violation of the decrees associated with such water which arise out of use or asse11ed use of such water by Centennial, including payment of Englewood 's reasonable attorneys fees, costs and other expenses related to the violation or claimed violation. 7 .3 No Liability to Third Parties Within Centennial Service Area. Centennial will not enter into any contract, lease, sale or other arrangement or obtain any decree which entitles or allows any person or entity other than Centennial to make any claim or demand against Englewood for delivery or use of Englewood Water within the Centennial Service Area , or for failure of delivery of Englewood Water for use within the Centennial Service Area. Centennial agrees to hold Englewood harmless from any loss, liability or claim arising from a claim or demand by any person or entity other than Centennial relating to or arising out of the delivery or use, or failure of delivery, of Englewood Water for use within the Centennial Service Area, including payment of Englewood 's reasonable attorneys fees, costs and expenses incurred in defending the claim or demand made by any person or entity other than Centennial. 7.4 No Liability Outside Centennial Service Area. Centennial will not enter into any contract , lease , sale, or other arrangement or obtain any decree which entitles or allows any person or entity including Centennial, to make any claim or demand against Englewood for delivery or use of Englewood Water outside the Centennial Service Area, or for failure of delivery of Englewood Water for use outside the Centennial Service Area. Centennial agrees to hold Englewood harmless from any loss, liability or claim arising from a claim or demand by any person or entity other than Centennial relating to or arising out of the delivery or use , or failure of delivery , of Englewood Water for use outside the Centennial Service Area, including payment of Englewood's reasonable attorneys fees, costs and expenses incurred in defending the claim or demand made by any person or entity other than Centennial. 8. Pricing of Water. 8.1 Introduction to Pricine of Water. Surplus Water available in each year will be allocated and delivered as High-Priced Water, Medium-Priced Water or Low-Priced Water. In January of each year, the maximum amounts of Surplus Water that may be allocated and delivered in that year as High-Priced Water and as Medium-Priced Water will be determined in accordance with paragraph 8.3. Surplus Water available in that year in excess of the maximum amounts of High-Priced Water and Medium-Priced Water for that year will be allocated and delivered in that year as Low-Priced Water. P:\dianas\AGMTS\2 003WaterFacilitiesSupplyAgreement.doc 4 8.2 Definition of Terms. Unless the context clearly requires otherwise, the following terms will have the meanings specified below. The definitions in paragraphs 8.2.l through 8.2.5 are for variable quantities that accumulate throughout each year, starting over at zero in the following year. The definitions in paragraphs 8.2.6 through 8.2.8 are for single annual values calculated once each year. 8.2.1 Offered Water: Surplus Water Englewood offers to sell to Centennial. 8.2.2 Delivered Water: Offered Water accepted for delivery by Centennial and subsequently delivered by Englewood to Centennial up to the amount accepted. 8.2.3 Obligated Water: Offered Water for which Centennial is obligated to pay . 8.2.4 Untaken Water: Obligated Water Centennial declines to take . 8.2.5 Contract Water: The sum of Delivered Water plus Untaken Water. Sketches #1 and #2 illustrate various relationships between these types of water. Sketch #1 -Delivered Water less than Obligated Water t-------------------------Offered Water t----------------------i.,' Delivered Water t--------------------,------i• Obligated Water e---1.-• Untaken Water t----------------------• Contract Water= Obligated Water Sketch #2 -Delivered Water greater than Obligated Water t--------------------------~ Offered Water r-----------------------i~• Delivered Water t---------------.1~•0bligated Water (Untaken Water= 0) t----------------------t~• Contract Water= Delivered Water P :\dianas\AGMTS\2 003WaterFacilitiesSupplyAgreement.doc 5 8.2.6 Annual Contract Water: many year. The total amount of Contract Water 8.2 .7 Threshold: The maximum amount of High-Priced Water in any year. 8.2.8 Ten-Year Average: The average of Annual Contract Water amounts for the ten previous years. The Ten-Year Average for the years 2003 through 2012 shall be based on the assumption that the amount of Annual Contract Water during 2002 and the previous nine years was 1500 acre-feet per year. 8.3 Allocation of Surplus Water to Categories . Two performance criteria , the Threshold and the Ten-Year Average, shall be used to allocate Surplus Water each year as High- Priced Water, Medium-Priced Water or Low-Priced Water. All Contract Water in any year that is less than or equal in amount to the Threshold for that year is High-Priced Water. All Contract Water in any year that is greater in amount than the Threshold for that year and less than or equal in amount to the Ten-Year Average for that year is Medium-Priced Water. All Contract Water in any year that is greater in amount than the Threshold for that year and greater in amount than the Ten-Year Average for that year, is Low-Priced Water. The Threshold and the Ten-Year Average shall be calculated in accordance with paragraphs 8.4 and 8.5. Sketch #3 illustrates the concept of three price categories based on two performance criteria, assuming the amount of Contract Water exceeds the Ten-Year Average, the Ten-Year Average exceeds the Threshold , and the Threshold is greater than zero. Sketch #3 -Price Categories and Performance Criteria A B Contract Water ~ .... Ten-Year Average ~ Contract Water here is a variable , r accumulating amount throughout the year Threshold (shown from left to right above). Contract .... Water at time A is High-Priced Water; at .... time B , Medium-Priced Water, etc. High-Priced Water Medium-Priced Water Low-Priced Water Centennial may take and pay for Low-Priced Centennial must pay for High-Priced Water and Water and /or water in excess of paragraph 9 limits , but is not required to do so. Once Medium-Priced Water, up to the limits in delivered, it becomes Contract Water and paragraph 9. contributes to future annual calculations of the Threshold and Ten-Year Average . P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 6 8.4 Calculation of Threshold During Threshold Initiation Period. For the years 2003 through 2015, unless sooner terminated hereunder, ("Threshold Initiation Period"), the Threshold shall be determined as follows: 8.4 .l Calculation of Threshold . For 2003 , the Threshold will be 1600 acre-feet. If Annual Contract Water is less than 1600 acre-feet in 2003 , then the adjusted Threshold for 2003 and the Threshold for subsequent years shall be calculated as described in paragraph 8.5. For 2004, the Threshold will be 1700 acre-feet, but only if Annual Contract Water in 2003 was 1600 acre-feet or more, and Annual Contract Water in 2004 is 1700 acre-feet or more. If either of the two requirements is not met , then the adjusted Threshold for 2004 and the Threshold for subsequent years shall be calculated as described in paragraph 8.5. For 2005 , the Threshold will be 1800 acre-feet, but only if Annual Contract Water in 2003 was 1600 acre-feet or more, Annual Contract Water in 2004 was 1700 acre-feet or more, and Annual Contract Water in 2005 is 1800 acre-feet or more. If any of the three requirements is not met , then the adjusted Threshold for 2005 and the Threshold for subsequent years shall be calculated as described in paragraph 8.5. For 2006 and subsequent years through 2015, the Threshold shall be 1800 acre-feet, if the Threshold for 2005 was 1800 acre-feet or more and if, in each of the years 2006 through 2015, Annual Contract Water equals or exceeds 1800 acre-feet. If either of those requirements is not met in any year, then the adjusted Threshold for that year and the Threshold for subsequent years shall be calculated as described in paragraph 8.5. During 2003, 2004, and 2005, and for a period thereafter, the Threshold may be greater than the Ten-Year Average. Nevertheless Contract Water within the Threshold shall be priced as High-Priced Water. While the Ten-Year Average is lower than the Threshold , there will be no Medium-Priced Water. 8.4.2 Refund of Payments During Threshold Initiation Period. If an adjustment to the Threshold for a previous year is required during the Threshold Initiation Period , then , within 30 days after the end of the year in which the adjustment is required , Englewood will refund to Centennial any excess payments made by Centennial for Contract Water during the previous year. 8.5 Calculation of Threshold After Threshold Initiation Period. In January of the year of termination of the Threshold Initiation Period and in each year thereafter, the Threshold for that year shall be dete1mined as follows: 8.5.l Defin ition of Additional Terms. Unless the context clearly requires otherwise, the following te1ms will have the meanings specified below: Ten-Year Minimum: The smallest amount of Annual Contract Water during the ten previous years . If the Threshold Initiation Period provided for in paragraph P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 7 8.4 terminates prior to 2012, the Ten-Year Minimum shall be based on the assumption that the amount of Annual Contract Water during 2002 and the previous nine years was 1500 acre-feet per year. The Ten-Year Minimum is used hereunder only to increase the Threshold . Threshold Buffer: An amount of hypothetical storage capacity consisting of 15 .15 percent of the capacity of McLellan Reservoir. For purposes of Threshold Buffer accounting, the 15 .15 percent is set at 900 acre-feet, and shall not vary with the physical siltation of McLellan Reservo ir. Threshold Sum: Annual Contract Water for the previous year plus Threshold Buffer Amount for the previous year, calculated in January of each year. Threshold Buffer Amount: The hypothetical amount of water left in the Threshold Buffer. The Threshold Buffer Amount may not be Jess than zero or more than the Threshold Buffer (900 ac re-feet). On January 1 , 2003, the Threshold Buffer Amount is zero. The Threshold Buff er Amount for 2004 and subsequent years shall be calculated as the Threshold Sum for the cuITent year less the Threshold for the previous year, with a maximum value of 900 acre-feet and a minimum value of 0 acre-feet. 8.5.2 Calculation of the Threshold . The Threshold for the cuJTent year shall be calculated as follows: 8.5.2.1 No Change in Threshold . If the Threshold Sum for the current year is equal to or greater than the Threshold for the previous year and the Ten-Year Minimum is equal to or Jess than the Threshold for the previous year, the Threshold for the crnTent year shall be the same as the Threshold for the previous year. 8.5.2.2 Reduction in Threshold . If the Threshold Sum for the current year is Jess than th e Threshold for the previous year, the Threshold Sum for the current year shall become the Threshold for the current year. 8.5.2.3 Increase in Threshold. If the Ten-Year Minimum exceeds the Threshold for the previous year, the Ten-Year Minimum shall become the Threshold for the cuJTent year. 8.6 Single-Use Water and Reusable Water. Englewood , in its sole discretion , shall determine whether Offered Water is single-use water or reusable water and, if reusable water, whether to offer the reuse rights to Centennial. Single-use water is that as to which, under applicable Colorado water law and Englewood's decrees , the return flows after a first use belong to the other appropriators on the stream. Reusable water is that as to which, under applicable Colorado water Jaw and Englewood's decrees, the return flows may be re-used to extinction by Englewood or its d es ignee, assuming retention of "dominion and control." If the Offered Water is reusable water and Englewood offers the reuse rights to Centennial, Centennial, in its sole discretion , shall determine whether to acquire the reuse rights associated with such water. If Centennial elects to acquire such reuse rights and such water is delivered to Centennial by P:\dianas\AGM TS \2003Water Fa ci litiesSupplyAgreement.doc 8 Englewood , all return flows from the first and subsequent uses of such reusable Delivered Water shall belong to Centennial. When Centennial intends to use reusable Delivered Water for which Centennial has not acquired reuse rights, Englewood shall have the right to designate whether Centennial uses that water or single-use Delivered Water, to the extent that both types of water are available for Centennial's use. If Centennial intends to use any Delivered Water, whether single-use or reusable, for release to the South Platte River to satisfy its augmentation obligations under any decree for an augmentation plan , then Centennial shall not utilize for that purpose reusable Deli ve red Water as to which Centennial has not obtained reuse rights, unless no single-use Delivered Water is available to Centennial to satisfy its augmentation requirements. 8.7 Purchase Price for Water. 8.7.1 High-Priced Water. The purchase price for High-Priced Water shall be $337 per acre-foot. 8.7.2 Medium-Priced Water. The purchase price for Medium-Priced Water shall be $175 per acre-foot. 8.7.3 Low-Priced Water. The purchase price for Low-Priced Water shall be $99 per acre-foot. 8.7.4 Reuse Rights. The purchase price for the reuse rights, if any, associated with High-Priced Water, Medium-Priced Water and Low- Priced Water shall be 33 percent of the purchase price set forth in paragraphs 8.7.1, 8.7.2 and 8.7.3, respectively. 8.8 Example Calculation. Exhibit D hereto is an example of hypothetical annual va lues calculated in accordance with this paragraph 8. 9. Centennial Payment Obligations. A portion of the Surplus Water available each year s hall be paid for by Centennial, whether Centennial takes delivery of such water or not. The remainder of the Surplus Water available each year may be taken by Centennial at its option, and, if taken, shall be paid for by Centennial. 9.1 Payment for Obligated Water. Centennial is obligated to pay for Offered Water that is priced as High-Priced Water or Medium-Priced Water, subject to the monthly limits ("month" or "monthly" in this Agreement means calendar month) in paragraph 9.1.1 and subject to the delivery rate limits in paragraph 9.1.2, whether or not Centennial takes delivery of such water. This is Obligated Water. To the extent Centennial chooses not to take delivery of Obligate d Water, the difference between Obligated Water and the amount of water taken by Centennial is Untaken Water. Untaken Water is subsequently accounted for as if Centennial had taken it and is included as Contract Water. P:\dianas\AGMTS \2003Wa terFacilitiesSupplyAgreement.doc 9 9.1.1 Monthly Limits on Amounts of Obligated Water. There are two sets of monthly limits on the amounts of Obligated Water as set forth in Tables 1 and 2. The monthly limits in Table 1 will be in effect until the demand for treated and untreated water within Centennial's Service Area in any year first equals or exceeds 20,000 acre-feet per year. The monthly limits in Table 2 will be in effect after such demand first equals or exceeds 20,000 acre-feet per year. Table 1. Monthly Limits in Acre-Feet Until Demand Eguals or Exceeds 20,000 acre-feet/yr: Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 390 390 390 750 1605 1920 2150 1650 1470 480 450 450 Table 2. Monthly Limits in Acre-Feet After Demand Eguals or Exceeds 20,000 acre-feet/yr: Jan Feb Mar I Apr May Jun Jul Aug Sep Oct Nov Dec 520 520 520 11000 2140 2560 2860 2200 1960 640 600 600 If during any month Centennial accepts delivery of water in an amount in excess of the monthly limit for that month in the applicable table, then , at Centennial's election, it may apply the excess amount against the applicable monthly limit at any subsequent time in the same year. 9.1.2 Delivery Rate Limits. When Centennial's storage capacity in McLellan Reservoir is nearing full safe capacity as determined in accordance with this paragraph 9.1.2 , the allowable rate of delivery (in cfs) of Obligated Water shall not exceed the delivery rate shown in Table 3 for the appropriate month . Englewood shall from time to time determine the full safe capacity of McLellan Reservoir ("Full Safe Capacity") which may be Jess than actual physical capacity for safety reasons (such as providing some storage capacity to contain runoff from thunderstorms). Englewood shall promptly notify Centennial of its determination of Full Safe Capacity. Centennial' s full safe capacity in McLellan Reservoir ("Centennial Full Safe Capacity") shall be 65.15 % of Full Safe Capacity based on this Agreement and the 1977 Ranch Creek Lease. The capacity adjustments for the appropriate month from Table 4 shall be subtracted from the Centennial Full Safe Capacity to determine the amount of storage ("Near Full Condition") which will trigger the daily delivery rate limits in Table 3. When the amount of water which Centennial has in storage in McLellan Reservoir equals or exceeds Near Full Condition , the daily delivery rate limits in Table 3 will apply. When the daily delivery rate limits from Table 3 for the appropriate month apply, Centennial's obligation to pay for water under this Agreement will be reduced to payment for the amount of water actually delivered or offered for delivery by Englewood, not to exceed the daily delivery rate limit. When the amount of water which Centennial has in storage in McLellan Reservoir is P:\dianas\AGMTS\2003Wa terFacilitiesSupplyAgreement.doc 10 less than the Near Full Condition, the daily delivery rate limits in Table 3 will not apply and the rate of delivery shall be as determined by Englewood, in its sole discretion . When the total amount of water in McLellan Reservoir equals or exceeds Full Safe Capacity , neither pa11y will increase the amount of water stored in McLellan Reservoir. Table 3. Daily Delivery Rate Limits in cfs When Centennial Storage is "Near Full Condition ": Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 8 8 8 17 35 43 48 35 33 10 10 10 Table 4. "Full Safe Capacity" Adjustment in Acre-Feet: Jan Feb Mar I Apr I May Jun Jul Aug Sep Oct Nov Dec 48 48 48 1102 1210 258 288 210 198 60 60 60 9.2 Payment for Non-Obligated Water. Centennial is not obligated to take or pay for Low-Priced Water or any water in excess of the amount of Obligated Water. If Centennial chooses to take Low-P1iced Water or water in excess of the amount of Obligated Water, that water if delivered becomes part of Contract Water for purposes of all subsequent calculations under this Agreement. Englewood may dispose of Offered Water which Centennial does not accept for delivery as Englewood determines in its sole discretion. 10. Place and Measurement of Deliveries: Pumping Costs: Notification. 10.1 Place of Delivery and Measurement. The place of delivery for all Delivered Water shall be McLellan Reservoir, except that , at any time after completion of Centennial's proposed South Platte Reservoir , the paities may mutually agree upon delivery to Centennial's South Platte Reservoir. The measuring points for measurement of Delivered Water are described in Table 5 and depicted on Exhibit E hereto. P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 11 Table 5 : Water Delivery and Measurement Summary Water Facility where Existing Owner -Delivery destination: diversion measurement measurement (entity taking Mclellan So. Platte structure* occurs device location measurements) Reservoir Reservoir City Ditch City Ditch Pump Meter on discharge Englewood x x Station piping Nevada Ditch Nevada Ditch Flume Flume between Centennial x x turnout st ructure off ditch and So . Platte Reservoir pump station forebav Last Chance Last Chance Ditch Flume between Centennial x Ditch Flume turnout structure off ditch and South Platte Reservoir Dad Clark Dad Clark Gulch Dad Clark Gulch Englewood x Gulch flows Flume (for lower downstream from flows) Highline Canal turnout structure (for high storm flows Mass balance cal-Englewood x exceeding flume culation of inflows measurement based on Mclellan capabilities) Reservoir water levels Highline Canal Dad Clark Gulch Meter: meter in-Englewood and x Flume (Englewood) stalled in 36" pipe Centennial and Dad Clark under Hwy C-470 . Gulch Meter Measurement is (Centennial) difference between flow readings from Flume and Meter. Highline Canal Highline Canal Highline Canal Englewood x Flume below gate Gate No. 29 + 427' * -there also may be water from other sources or other water rights measured at these locations P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 12 10 .2 Pumping Costs. Pumping costs incurred by Englewood for deliveries of Contract Water to Centennial under this Agreement shall be borne by Englewood. 10.2.1 City Ditch Pump Station . Englewood owns and operates the City Ditch Pump Station shown on Exhibit F hereto. Englewood shall bear all costs, including all operation , maint e nance , electrical, repair and improvement costs, associated with delivery of Contract Water to Centennial under this Agreement using the City Ditch Pump Station. 10.2.2 South Platte Reservoir Pump Station . Centennial owns and operates the South Platte Reservoir Pump Station shown on Exhibit F hereto. Englewood shall pay to Centennial Englewood's proportional share of operation and maintenance costs and electrical costs associated with delivery of Contract Water to Centennial under this Agreement using the South Platte Re servoir Pump Station. Englewood's propo11ional share of operation and maintenance costs and electrical costs for delivery of Contract Water to Centennial under this Agreement using the South Platte Reservoir Pump Station shall be determined by Centennial using the same methodology as described in paragraphs 13.8 .2 and 13 .8.3 for determining such costs for City Ditch Pump Station. Centennial shall bill Englewood for such costs after the end of each month. Payment shall be due in full 45 days from date of delivery of the invoice. Payments past due shall bear interest at the rate of 12 percent per year, compounded quarterly. 10.3 Notification by Englewood of Amounts Available for Delivery; Response by Centennial. In order to facilitate the delivery of water under this Agreement by Englewood to Centennial, the parties shall provide the following notices to each other. 10.3.1 Operational Notice. Englewood shall give Centennial reasonable advance notice, which shall not be less than 24 hours , of the availability of Surplus Water for delivery under this Agreement. Such notice may be oral or in writing, and shall include, at a minimum , the quantity of water, rate of delivery of water, the identity of the water right which is the source of the water and whether the water is single-use water or reusable water. Centennial shall notify Englewood whether Centennial accepts or rejects delivery of such water within a reasonable time after receipt of Englewood 's notice , which shall not be less than 12 hours . Such notic e may be oral or in writing. 10.3.2 Planning Notice. No Jess than 30 days before the beginning of eac h month , Englewood s hall notify Centennial of the quantity of Surplus Water Englewood will have available, or attempt to have available, for delivery during that month , whether such water is si ngle-use water or reusable water, and if reusable water, whether Englewood is offering the reuse rights to Centennial. Within 10 days after receipt of Englewood's notice , Centennial shall notify Englewood of the maximum amount of such water Centennial may accept and whether Centennial may elect to acquire the reuse rights from Englewood. The notices provided for in this paragraph 10.3.2 are for planning purposes only and shall not bind either party . 11 . Measurement Devices , Recordkeeping, Billing and Payment. P :\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 13 11.1 Centennial Measurement Devices and Recordkeeping. Accurate continuous-recording flow measurement devices shall be instaJJed and maintained by Centennial at each of the measuring points described in Table 5 that are owned by Centennial. The records of measurement of Delivered Water during each month shall be provided by Centennial to Englewood within ten days after the ,end of each month . l 1.2 Englewood Measurement Device s and Recordkeeping . Accurate continuous-recording flow measurement device s shall be installed and maintained by Englewood at eac h of the measu ring points described in Table 5 that are owned by Englewood. The records of measurement of Delivered Water during each month shall be provided by Englewood to Centennial within ten days after the end of each month . Records of deliveries shall include deliveries made by "bookovers" from Englewood to Centennial of Englewood's water previously stored in McLellan Reservoir . 11 .3 Annual Accounting and Calculations . Englewood shall keep records of Delivered Water and Untaken Water accounted for as Contract Water which are necessary or useful in the calculation of prices and amounts due , including, but not limited to , the Threshold , the Ten-Year Average, the Ten-Year Minimum, Untaken Water, Annual Contract Water, monthly deliveries, and the like. By January 15 of each year, Englewood shall deliver to Centennial an accounting of such items for the previous year and Englewood's calculations of the Threshold, the Threshold Buffer Amount and the Ten-Year Average for the current year. By January 31 of each year, Centennial shaJJ notify Englewood of the items to which objection is made. In the absence of such notification , or as to items as to which no objection is made, the accounting for the previous year and Englewood 's calculations of the Threshold, the Threshold Buffer Amount and the Ten-Year Average for the current year s hall be deemed to be correct. 11.4 Reconciliation, Billing and Payment. Englewood and Centennial shall reconcile their respective accounting records after the end of each month. Thereafter, Englewood shall bill Centennial for Contract Water under this Agreement during that previous month . Payment shall be due in full 45 days from date of delivery of the invoice. Payments past due shall bear interest at the rate of 12 percent per year, compounded quarterly. Within 60 days after the end of each year, a reconciliation shall be made of billings for that year, and any necessary adjustment payments shall promptly be made between the paities. 12. Amendments to 1977 Ranch Creek Lease. Paragraphs 21and22 of the 1977 Ranch Creek Lease are replaced in their entirety by the following provisions and said paragraphs 21 and 22 sh al I hereafter be of no further force or effect: 12 . l Englewood agrees to sell and Centennial s hall have the option to purchase all _of Englewood's "Paid Deliveries " water at the initial time of its availability each year as hereinafter provided. "Paid Deliveries" water is that water available to Englewood under paragraphs 3.3 through 3.7 of the Settlement Agreement dated August 11, 1995 , among P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 14 Englewood , Cyprus Climax Metals Co ., and the City and County of Denver, acting by and through its Board of Water Commissioners (" 1995 Englewood/Cyprus/Denver Agreement"). 12.2 If Centennial accepts delivery of Paid Deliveries water at the initial time of its availability each year to Englewood , then neither the Ten-Year Minimum nor the Ten-Year Average shall include the Paid Deliveries water taken by Centennial. Centennial shall have any rights to reu se of Paid Deliveries water. 12.3 If Centennial does not accept delivery of Paid Delive1ies water at the initial time of its availability each year to Englewood , then Englewood may take and use such water as Englewood determines, including storing such water and later including such water in the Surplus Water Englewood sells to Centennial under this Agreement. In this event, Paid Deliveries water shall be treated in the same manner as provided for other Surplus Water in this Agreement , including the inclusion of such Paid Deliveries water in the calculation of the Ten- Year Minimum and the Ten-Year Average hereunder. 12.4 The price per acre-foot for Paid Deliveries water accepted and taken by Centennial under paragraph 12.2 shall be the sum of 1) the amount charged per acre-foot by Denver to Englewood for delivery of such water, 2) a fixed charge of $20 per acre-foot paid by Centennial to Englewood, and 3) the cost per acre-foot to Englewood of pumping such water from City Ditch to McLellan Reservoir determined in accordance with the methodology described in paragraphs 13.8.2 and 13 .8.3 or, if such water is delivered to Centennial through the High Line Canal, the amount per acre-foot Denver charges Englewood for delivery of such water through the High Line Canal or, if such water is delivered to Centennial through the Nevada Ditch , the amount the Nevada Ditch Holding Company charges per acre-foot to Englewood for delivery of such water through the Nevada Ditch. 12.5 Englewood and Centennial agree to cooperate in scheduling deliveries of Paid Deliveries water to Centennial ; however , Englewood shall be responsible for scheduling deliveries with Denver. 12 .6 Centennial shall comply with paragraph 3 .3.5 of the 1995 Englewood/Cyprus/Denver Agreement. A copy of paragraph 3.3.5 is attached as Exhibit G hereto . 12.7 All other pro vision s of the 1977 Ranch Creek Lease remain in full force and effect. 13 . Physical Facilities Lease. 13.l Grant of Lease . In addition to the provisions for sale and delivery of water set forth above and elsewhere herein , Englewood , as lessor, leases to Centennial , as Jessee , and Centennial , as lessee , leases from Englewood , as lessor, a portion of the capacity of certain Englewood physical facilities described below , to be used for the delivery and storage of water on the terms and conditions more particularly set forth below ("Facilities Lease"). P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement .doc 15 13.2 Englewood Physical Facilities in Which Capacity ls Leased to Centennial; Use of Same. The physical facilities in which capacity is leased by Englewood to Centennial ("Physical Facilities") are McLellan Reservoir, City Ditch from the Chatfield Reservoir ditch outlet manifold downstream to the Englewood City Ditch Pump Station , Nevada Ditch from the Chatfield Reservoir ditch outlet manifold downstream to the turnout structure on the ditch at which water is delivered to Centennial, the Englewood City Ditch Pump Station , the Discharge Facility from McLellan Reservoir to the South Platte River, and the pipeline from McLellan Reservoir to the Discharge Facility, which is used both to caJTy water from the City Ditch Pump Station to McLellan Reservoir and from McLellan Reservoir to the Discharge Facility. The Physical Facilities are depicted on Exhibit H hereto. The leased capacity may be used by Centennial to store and/or c aJT y a ny water which may legally be stored and/or carried therein . Englewood shall be solely responsible for all necessary or desirable contacts with third parties , including the United States Army Corps of Engineers , related to use of the Physical Facilities by Centennial under this Facilities Lease. 13.3 McLellan Reservoir. Englewood hereby leases to Centennial the exclusive right to use l 5 .15 per cent of the capacity of McLellan Reservoir for storage of water, subject to the rights of each party to use the temporarily unused capacity of the other party as provided in paragraph 13 .3.8 below . 13 .3.l Determination of Capacity of McLellan Reservoir. The parties are uncertain as to the present actual capacity of McLellan Reservoir because the capacity changes with siltation , and because minor iITegularities in the elevation of the bottom of the reservoir limit the accuracy of any determination of capacity. For purposes of determining the initial amount of capacity available to Centennial hereunder, the present actual capacity of McLellan Reservoir shall be deemed to be 5940 acre -feet, and the capacity initially leased to Centennial is 900 acre-feet. Either pa11y , at its own expense , may obtain a survey by a professional engineer or surveyor licensed jn the State of Colorado to better de.te1mine the actual capacity of McLellan Reservoir at the maximum water elevation level and shall provide the results of such survey to the other party. Englewood s hall reasonabl y determine the maximum water elevation level which is both safe and presents no appreciable risk of damage to the physical structures. If either party obtains such a survey and s uch s urvey shows a different capacity than 5940 acre-feet at the maximum water elevation level determined by Englewood , then the parties shall attempt to agree upon a revised capacity and a revised lease payment for McLellan Reservoir for purposes of this Facilities Lease ; provided , however, that the capacity available to Centennial hereunder shall not exceed 900 acre-feet. 13.3 .2 No Reduction in Payment Due to Siltation. The charge paid by Centennial to Englewood for use of McLellan Reservoir capacity will not be reduced propo11ionately if the capacity available to Centennial hereunder is reduced below 900 acre-feet due to siltation. 13.3.3 Removal of Silt, or other Restoration of Capacity, Performed by Englewood. If Englewood determines to restore the storage capacity of McLellan Reservoir to P:\dianas\AGMTS\2 00 3WaterFacilitiesSupplyAgreement .doc 16 5940 acre-feet by dredging , enlargement or other methods, then Centennial shall have the option of paying 15 .15 per cent of the cost thereof, and of using 15.15 per cent of the increase in capacity , pursuant to this Facilities Lease. If Englewood determines so to restore capacity, it shall give notice to Centennial , in reasonable detail , of its plans for restoring capacity, and an estimate of the anticipated cost thereof. Centennial shall have 45 days after receipt of notice from Englewood, to exercise its option to pay 15 .15 per cent of such cost. Centennial ·shall give notice of the exercise of its option to Englewood. Englewood shall bill Centennial for Cent.enni al' s 15 .15 percent of such costs. Payment shall be due 45 days from the date of deli very of the invoice . If Centennial does not exercise its option as provided for herein , then all increases in capacity resulting from Englewood 's proposed project shall belong solely to Englewood. Englewood , in its sole discretion, may decide to increase the storage capacity of McL ellan Reservoir to an amount in excess of 5940 acre-feet, at Englewood's expense . If Englewood does so , then Englewood shall have the sole right to use the storage capacity in excess of 5940 acre-feet. 13 .3.4 Removal o f Silt by Centennial. Centennial may remove silt to restore the capacity of McLellan Reservoir to 5940 acre-feet at its own initiative and at its own cost ; provided, however, that the capacity available to Centennial under this Facilities Lease as a result of such silt removal shall not exceed 900 acre-feet. If Centennial desires to remove silt at its own cost, then Centennial shall give Englewood notice of its proposed silt removal project in reasonable detail, including the proposed plans, specifications , construction contract, disposition of the removed mate1ial, name of the contractor (or contractors) who will be permitted to bid, a cost estimate by a qualified professional engineer, name of an engineering firm to observe the work , public liability insurance to be provided, indemnification of Englewood to be provided, and the bond to be obtained. Englewood shall have the right, reasonably exercised, to disapprove or require alteration of all or any part of the proposed silt removal project including the plans , specifications , contractor, bond , engineering firm, method of disposition of removed material, public liability insurance to be provided , indemnification of Englewood, or any other aspect of the proposed project, by notice to Centennial within 45 days after receipt of Centennial's notice. If Englewood gives such notice , Centennial shall not proceed with its proposed silt removal project without written approval from Englewood. If Englewood does not give such notice, Centennial may proceed with its proposed silt removal project. Centennial shall not be entitled to undertake any actions to restore or increase the capacity of McLellan Reservoir other than silt removal. 13.3.5 Reduction in Stora2e Capacity by Causes Other Than Siltation. If the capacity of McLellan Reservoir is reduced below 5940 acre-feet other than by siltation, then Englewood shall proceed, within a reasonable period of time after the reduction, to restore lost capacity to Centennial by reasonable and practical repairs or alterations to McLellan Reservoir, at Englewood 's sole cost. In the alternative, Englewood may elect to transfer a portion of its own capacity in McLellan Reservoir to Centennial. If Englewood restores lost capacity to Centennial by a transfer of a portion of Englewood 's own capacity, then Englewood may subsequently restore lost capacity to Centennial by repairs or alterations to McLellan Reservoir at Englewood 's sole cost, and the Englewood capacity previously transferred to Centennial shall then be returned to Englewood. P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement .doc 17 13.3.6 Drainage for Operations or Repairs. If Englewood determines, in its sole discretion, that it is necessary to drain water from McLellan Reservoir to facilitate repairs or replacements or to meet safety requirements, or because of pollution or contamination, then the pai1ies shall share the loss of water in proportion to the amounts of water each had in storage in McLellan Reservoir prior to the drainage. Englewood shall give Centennial advance notice, if possible, of such drainage event. 13.3.7 Losses from Seepage, Evaporation. Failure of Facilities and the Like. Losses of water from McLellan Reservoir caused by seepage, evaporation, failure of facilities, or any cause beyond the reasonable control of Englewood shall be borne by the pa11ies in proportion to the amounts of water each had in storage in McLellan Reservoir when the losses occuned. Englewood shall determine evaporation and seepage losses according to recognized engineering standards . 13.3 .8 Storage By Either Party in Capacity of Other Party. Either party may from time to time have capacity in McLellan Reservoir which is not occupied by water stored by that party ("temporarily unused capacity"). Either party may store its water in the temporarily unused capacity of the other party. Such water so stored shall be removed from such temporarily unused capacity when the other pai1y wishes to use such temporarily unused capacity and has water available which it could store therein. If such water cannot be removed in a timely manner from such temporarily unused capacity, then such water shall be spilled or booked over to the other party at no cost , to the extent the other party could have delivered water into such temporarily unused capacity. 13.3.9 Addition of Substances to McLellan Reservoir. Either party may add customary chemicals , such as copper sulfate, to the water in McLellan Reservoir to control algae and other undesirable aquatic vegetation. The party making such an addition, however, agrees as follows: 13.3.9.1 Coordination. The party making the addition shall ascertain from the other party that the other party has not added chemicals within a period of time such that the previously added chemicals may still be present, in some degree, and thus impact the appropriateness of a further addition of chemicals. The party making the addition shall also ascertain from the other party any releases from the reservoir to the South Platte River or City Ditch which may be contemplated during the period when the chemical will be present, to any significant degree, in the water of the reservoir. No addition shall be made if it would hamper the ability of either party to make a release from McLellan Reservoir to the South Platte River or City Ditch . 13.3.9.2 Permits. The party making the addition shall strictly follow al l applicable statutes and regulations, and obtain all necessary permits from governmental agencies having or asserting ju1isdiction over the addition, and strictly comply with the terms of a n y permit or permits, and advise the other party of its actions and the schedule for the addition. The party making the addition shall bear the risk that a governmental body may insist that a particular permit was necessary, but was not obtained, notwithstanding a good faith belief on the P :\d ianas\AG MT S\2003W aterF acilitiesSupply Agreement. doc 18 part of the pai1y making the addition that the particular permit was unnecessary or that a sufficient permit had been obtained. 13.3.9.3 R ecommended Practices. The party making the addition shall strictly follow the manufacturer's rec ommended practices for use of the chemical to be added , in every respect. 13.3.9.4 Fi nes , Dama!:!es, Fees . The party making the addition shall pay all fines or damages, regardless of the entity or person upon whom they are levied, which result from or are related to the addition of the chemical , and any attorneys fees, costs and expenses of the other party occasioned the reby. 13.3.10 No E ffl uent Directly Into City Ditch or McLellan Reservoir. Without the prior written consent of the Englewood City Council, which may be withheld without cause , Centennial shall not disc ha rge effluent from a wastewater treatment plant directly into City Ditch or McLellan Reservoir. The foregoing prohibition shall not apply to effluent from a wastewater treatment plant, whi c h meets the applicable discharge permit effluent limitations, and which is carried to Centennial's South Platte Reservoir and commingled with water already therein before its caniage to McLellan Reservoir. 13.3.11 Record s, Accounting. Englewood sha11 keep accurate daily records of the amount of water which e ach party has in storage in McLe1Jan Reservoir. Centennial shall keep and promptly su p ply Englewood with accurate daily records of all deliveries of Centennial's water into M cLe1lan Reservoir, and its withdrawals from same, including records of the method of deli very (e.g. pumping , flow from the lligh Line Canal, flow from Centennial wells), the decree unde r which the water was delivered, and whether the water is single-use or reusable water. Englewood shall keep similar records of its deliveries into and withdrawals from McLe1Jan Reservoir. Each party may review the records of the other during business hours. 13.3.12 Lease Payment for Use of McLellan Reservoir Capacity. Centennial shall pay Englewood $233,500 per year for use of McLellan Reservoir capacity hereunder. The annual payment shall be made in quarterly insta1lments due on the first day of January , April, July and October of each year. The first payment shall be due on the date of this Agreement. 13.4 City Ditch Faci lities . Englewood hereby leases to Centennial the exclusive right to use all excess capacity in the City Ditch from the Chatfield Reservoir ditch outlet manifold downstream to the Englewood City Ditch Pump Station, the Englewood City Ditch Pump Station, the Discharge Facility from McLellan Reservoir to the South Platte River, and the pipeline from McLellan Reserv oir to the Discharge Facility, which is used both to carry water from the City Ditch Pump Station to McLellan Reservoir and from McLe1lan Reservoir to the Discharge Facility ("City Ditch Facili ties"). Excess capacity for purposes of this Facilities Lease is defined as the maximum carrying capacity from time to time of that portion of the City Ditch Facilities Centennial desires to u se after the capacity needs of others who presently have rights to use of capacity in City Ditch a re satisfied, including but not limited to Englewood and P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 19 capacity used by Englewood for delivery of water to Centennial under this Agreement , and the users of City Ditch as desc1ibed in paragraph 13.4.2 . 13.4 .l Determination of Capacity. Englewood shall determine from time to time the maximum carrying capacity of the City Ditch Facilities, in its sole and reasonable discretion, based upon safety , hydraulic capacity, and avoidance of injury to the physical facilities , and Englewood 's relationships with third parties concerning use of capacity of the City Ditch Facilities . 13.4 .2 Existing City Ditch Agreements with Third Parties. Use of the City Ditch is presently subject to the rights of contract users of the City Ditch 1860 priority water right south of Harvard Gulch ("Contract Users"), the rights of the City and County of Denver under an agreement between Denver and Englewood dated October 3 , 1995 attached hereto as Exhibit I, and the rights of Littleton Cemetery under an agreement dated May 23, 1933 attached hereto as Exhibit J (collectively the "Existing City Ditch Agreements "). The parties recognize the possibility that one or more of the Existing City Ditch Agreements could be terminated during the term of this Agreement. Englewood shall have the sole right to deal with and receive consideration from the contract Users, the City and County of Denver and the Littleton Cemetery concerning any and all aspects of the Existing City Ditch Agreements , including any and all aspects of termination thereof. Any capacity in City Ditch that becomes available upon termination of any one or more of the Existing City Ditch Agreements shall become Englewood 's capacity ("Englewood Reversionary Capacity"), subject to use by Centennial only in accordance with the priorities set forth in paragraph 13.4.3. 13.4.3 Priority to Use of Capacity in City Ditch Facilities. Use of capacity in the City Ditch Facilities shall be in the following order of prio1ity: 13.4 .3.1 City Ditch Water Rights and Englewood Reversionary Capacity. City Ditch water rights with priority date of 1860, including Englewood's ownership of same and contract users of same ; the one share of Nevada Ditch water transferred to City Ditch by the Littleton Cemetery Association by decree of the District Court for Douglas County in Case No. 1212 in 1933 ; and water carried by Englewood, from any source , in Englewood's Reversionary Capacity. 13.4 .3.2 Ene:lewood's Boreas Pass No. 2 Ditch Water Right. Englewood's transmountain Boreas Pass No. 2 Ditch water right which Englewood purchased in the 1950's , prior to the 1977 Ranch Creek Lease. 13.4.3 .3 1948 McLellan Reservoir Storae:e Right. Englewood's 50 % interest and Centennial's 50% interest shall share equally in the available capacity in the City Ditch Facilities ; provided, however, that for purposes of pri01ity to use available capacity, Englewood may choose to use capacity in the City Ditch Facilities associated with its 50% interest in the 1948 McLellan Reservoir storage right to carry other Englewood water rights or contract water owned by Englewood. For purposes of priority to use available capacity, Centennial's use of capacity in the City Ditch Facilities associated with its 50% interest in the 1948 McLellan Reservoir storage right is limited to the carriage of its 50% interest in the P :\dianas\AGMTS\2 003WaterFacilitiesSupplyAgreement.doc 20 McLellan Reservoir storage right only and Centennial may use such capacity to carry other of its water supplies only under the priority to use available capacity provided by paragraph 13.4.3.6. 13.4.3.4 Paid Deliveries Water. Paid Deliveries water to be delivered to Englewood during the m onths of May and June, unless Denver and Englewood agree on an ad hoc basis to a delivery during some other period of time. 13.4.3 .5 Other Englewood Water Rights and Contract Water. All Englewood w a ter rights decreed for diversion at City Ditch and all of Englewood's contract deliveries of water provided by others , other than "Paid Deliveries" water described in paragraph 13.4.3.4 above , inclusive of any such future water rights and contract water. 13.4.3.6 Centennial Water Rights and Contract Water. All of Centennial's water rights decreed for di version at City Ditch and all of Centennial's contract deliveries of water provided by persons or entities other than Englewood, inclusive of any such future water rights and contract water. 13.4.4 Englewood Not to Make Additional Transfers of Capacity In City Ditch Facilities. Englewood will not make further leases , assignments or other transfers of capacity in the City Ditch Facilities wi thout the prior written consent of Centennial, except as otherwise provided in paragraph 13.4.2 . Centennial may withhold its consent in its sole and reasonable discretion , except that Cente nnial will grant its consent to transfers in settlement of litigation or threatened litigation with third parties, by or against Englewood, which will not materially affect the volume of water which Centennial can carry through the City Ditch Facilities. 13.5 Nevada Ditch . E nglewood hereby leases to Centennial all of Englewood's capacity in the Nevada Ditch which re m ains after satisfaction of Englewood 's needs for capacity in the Nevada Ditch, including capacity used by Englewood for delivery of water to Centennial and without regard to whether Englew o od uses its Nevada Ditch capacity for delivery through the Nevada Ditch below the Nevada Ditch valve house (see Exhibit F) after delivery through the Chatfield Reservoir ditch outlet manifold , or uses its Nevada Ditch capacity for delivery of water through City Ditch . 13.5 .l Nevada D itch By Laws and Englewood Capacity. The lease of Englewood's capacity in the Nevada Ditch to Centennial shall be subject to the bylaws of the Nevada Ditch Holding Company, and for purposes of the bylaws as presently in force or as changed in the future , shall be deemed to be between Englewood and Centennial. Those bylaws shall determine Englewood 's share of the capacity of the Nevada Ditch. 13 .5.2 Englewood Not to Make Additional Transfers of Capacity In Nevada Ditch. Englewood will not m ake further leases , assignments or other transfers of capacity in the Nevada Ditch without the prior written consent of Centennial. Centennial may withhold its consent in its sole and reasonable judgment, except that Centennial will grant its consent to transfers in settlement of litigation or threatened litigation with third parties, by or P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 21 against Englewood, which will not materially affect the volume of water which Centennial can convey through the Nevada Ditch. 13.6 Englewood's Nevada Ditch Capacity Delivered at City Ditch. Because of its ownership of City Ditch, and its ownership of shares in the Nevada Ditch Holding Company, Englewood has the right to caiTy water through the Chatfield Reservoir ditch outlet manifold, using capacity in the Chatfield Reservoir ditch outlet manifold allocated to its ownership in the two ditches . The piping system below the Chatfield Reservoir ditch outlet manifold bifurcates into two pipes, one of which is for City Ditch and one of which is for Nevada Ditch. Centennial will not object if Englewood takes water transported through the Chatfield Reservoir ditch outlet manifold pursuant to Englewood 's right to use capacity in the Nevada Ditch through the City Ditch pipe instead of through the Nevada Ditch pipe. 13.7 Lease Payment for Use of Capacity in City Ditch Facilities and in Nevada Ditch. Centennial shall pay Englewood $35,000 per year , plus annual operation and maintenance costs described in paragraph 13.8, for use of capacity in the City Ditch Facilities and in the Nevada Ditch hereunder. The annual payment shall be made in quarterly installments due on the first day of January , April, July and October of each year. The first annual payment shall be due on the date of this Agreemen t. 13.8 Payment of Annual Operation and Maintenance Costs as Additional Lease Payment. As an additional payment under this Facilities Lease, Centennial shall pay Englewood each year a portion of Englewood's actual operation and maintenance costs for the City Ditch Facilities and for Nevada Ditch to be determined as follows: 13 .8.l City Ditch Operation and Maintenance Costs. Centennial shall pay to Englewood a propo11ional share of th e operation and maintenance costs of City Ditch from the valve house to the Englewood City Ditch Pump Station, as reasonably determined by Englewood. Such costs shall include costs for personnel, preventive maintenance and repair maintenance. Englewood shall keep accurate records of such costs and such records will be available for inspection by Centennial during business hours. The proportional share of such costs to be paid by Centennial shall be determined monthly by multiplying such costs by the ratio of the volume of water in acre-feet carried by Centennial in City Ditch during that month to the total volume of water in acre-feet canied in City Ditch during that month, as measured at the flume below the valve house. (See Ex h ibit F) 13 .8.2 City Ditch Pump Station and Pipeline to McLellan Reservoir and Discharn:e Facilities from McLellan Reservoir to the South Platte River Operation and Maintenance Costs. Centennial shall pay to Englewood a proportional share of the operation and maintenance costs of the City Ditch Pump Station and pipeline to McLellan Reservoir, excluding electrical pumping costs, and of the operation and maintenance costs of the Discharge Facility from McLellan Reservoir to the South Platte River, as reasonably determined by Englewood. Such costs shall include costs for personnel, preventive maintenance and repair maintenance. Englewood shall keep accurate records of such costs and such records shall be available for inspection by Centennial during business hours. The proportional share of such costs to be paid by Centennial shall be determined monthly by multiplying such costs by the ratio of the volume P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 22 of water in acre-feet pumped by Centennial from the City Ditch Pump Station to McLellan Reservoir dming that month to the total volume of water in acre-feet pumped from the City Ditch Pump Station to McLellan Reservoir during that month , as measured at the meter on the discharge piping from City Ditch Pump Station. 13.8.3 City Ditch Pump Station Electrical Pumping Costs. Centennial s h a ll pay to Englewood a proportional share of the electrical cost of pumping water at the Englewood Cit y Ditch Pump Station , determined by multiplying the electrical cost during the billing period by the ratio of the volume of water in acre-feet pumped by Centennial during the billin g period to the total volume of water in acre-feet pumped during the billing period. 13 .8.4 Nevada Ditch. Centennial shall pay to Englewood any costs of the Nevada Ditch Holding Company expressly assessed against Englewood for carriage of water by Centennial , other than Contract Water delivered by Englewood to Centennial under this Agreement. Englewood shall pay all other assessments of the Nevada Ditch Holding Company without reimbursement by Centennial. 13.8 .5 Billing and Payment. Englewood shall bill Centennial for the additional lease payment due under this paragraph 13 .8 after the end of each month. Payment shall be due in full 45 days from date of delivery of the invoice. Payments past due shall bear interest at the rate of 12 percent per year, compounded quarterly. 13.9 Control of Operations. Englewood shall have complete and exclusive control of the operation , maintenance and repair of the Physical Facilities leased to Centennial hereunder and any alterations, improvements or additions thereto, and of replacement thereof, except as expressly provided in paragraph 13 .3 .4 above for removal of silt from McLellan Reservoir by Centennial. 13.10 Timeliness of Repairs . If Englewood fails to take prompt and reasonable steps to repair any of the Physical Facilities leased to Centennial hereunder in whole or in part, and such failure adversely affects Centennial 's water delivery and/or storage potential , the pa11ies agree to cooperate in allowing Centennial to timely repair any of such Physical Facilities , following approval of the proposed repair plan by Englewood , which approval may not be unreasonably withheld. Englewood shall reimburse Centennial for the costs of such_repair within 12 months of the date of completion of the repair, unless otherwise agreed to by Centennial and Englewood. 14 . Grant of Easements to Centennial. Englewood agrees to grant to Centennial , without charge to Centennial, certain permanent easements over, under and across property owned or controlled by Englewood ("Centennial Ease ments") upon the following terms and conditions: 14.1 Specific Instrument. Each of the Centennial Easements shall be granted in a specific instrument , to be executed after a surveyed legal description of the easement is obtained by Centennial , and prior to the time of commencement of construction by Centennial of any facilities within the easement. P :\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 23 14.2 · Locations. The Centennial Easements shall be over, under and across properties owned or controlled by Englewood surrounding McLellan Reservoir north of County Line Road and across the City Ditch rig ht of way. 14 .3 Term and Type. The Centennial Easements shall be permanent and non- exclusive. 14.4 Purpose and Scope. The Centennial Easements shall be for the purpose of transpo11ing water, and to that end Centennial may install , maintain, repair, replace , operate and remove pipes, pumps and related faci Ii ties in the easements. 14.5 Route Selection. Englewood shall have the right reasonably to select the route of any of the Centennial Easements, so as to avoid the location of, or minimize disruption of, existing or anticipated streets, struct ures, pipes, ditches , utility facilities, or areas to be developed, and/or to concentrate easements for various utilities into particular corridors . 14.6 Reasonable Standards. Englewood may set reasonable standards for the depth at which pipes must be installed , compaction of earthwork, protection of Centennial's pipes or other facilities against anticipa ted surface uses, protection of existing structures and ditches, separation from or protection of adjacent utilities, the repair or replacement of streets or other facilities or structures through which the pipes must be installed , the timing of construction so as to minimize disruption of traffic or other ongoing activities, and the maintenance and repair of facilities constructed by Centennial. 14 .7 Limitation on Oblieation to Grant. Englewood shall not be obligated to grant any easement which, in the reasonable opinion of Englewood , is likely to necessitate a review under Section 7 of the Endangered Species Act or any similar or successor legislation. 14.8 Limitation on Locations and Standards Selections. Englewood shall not select locations of, or standards for the use of, the Centennial Easements which unreasonably increase the cost to Centennial for installation , maintenance, repair, replacement, operation or removal of Centennial 's facilities within the Centennial Easements. 14.9 Englewood Relocation and Reconstruction . Englewood may reasonably relocate any of the Centennial Easements and reconstruct the facilities therein , at Englewood's sole expense and risk. The relocation and/or reconstruction must be accomplished without interruption of water service to the Centennial Service Area. The reconstructed facilities must be equivalent to those replaced. Englewood shall give Centennial reasonable advance notice of any proposed relocation or reconstruction, and consider all written suggestions of Centennial concerning same. 14.10 Exclusions. It is not intended by the parties that the Centennial Easements will include easements for the use of City Ditch or any length of the City Ditch right of way, or the High Line Canal, or McLellan Reservoir to convey or store water. P :\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 24 15 . Englewood 's Option to Participate in the Construction and Use of New Centennial Facilities. If Centennial decides to construct new facilities for the transmission of water from Chatfield Reservoir or from Englewood's Union Avenue Pump Station to City Ditch or McLellan Reservoir or to or through any of Englewood's property suJTounding McLellan Reservoir north of County Line Road, Englewood shall have the option to participate in the construction and use of such facility or facilities in accordance with the following provisions . 15 .1 Notifications. Centennial shall , prior to preparation of final plans and specifications for such facility or facilities, provide Englewood with conceptual information concerning the estimated cost , sizing, location and operation of the facility or facilities . Within 60 days after receipt of s uch conceptual information, Englewood shall notify Centennial in writing that Englewood is interested in participating in the construction and use of the facility or facilities. If Englewood does not give s uch notice to Centennial , Englewood shall have no further rights hereunder to pai1icipate in s uch facility or facilities. 15 .2 Desi!rn and Englewood Participation. If Englewood gives notice that it desires to pa11icipate in the construction and use of the facility or facilities, Englewood and Centennial shall attempt to reach agreement as to the design of the facility or facilities to accommodate use by both Englewood and Centennial and the terms of Englewood 's participation in and use of the facility, including but not limited to control of operation, maintenance and repair and allocation of costs of operation, maintenance and repair. If no agreement can be reached between Englewood and Centennial within 120 days after Englewood 's notice to Centennial of Englewood's desire to participate in the construction and use of the facility or facilities, Centennial shall be free to proceed with the facility or facilities and Englewood shall have no further rights hereunder with respect to such facility or facilities. 15 .3 En g]ewood Payments. If Englewood participates in construction and use of any facility or facilities hereunder, Englewood shall within 60 days of completion of construction thereof, pay its proportionate share of the costs and expenses of construction of the facility or facilities based on the relation of the capacity reserved for Englewood 's use (when full capacity is being used) to the total capacity of the facility or facilities. Costs and expenses shall include all costs and expenses including design, construction, interest and financing costs. If Englewood desires to pa11icipate in construction and use of a facility or facilities but does not then have payments available from Cen tennial under this Agreement with which to pay its proportionate share of the costs and expenses of construction of the facility or facilities, Centennial and Englewood agree to use their best efforts to establish an aJTangement by which Centennial will construct the facility at Centennial's initial cost and expense, with Englewood repaying to Centennial Englewood 's proportionate share of costs and expenses of construction of the facility or facilities , together with interest thereon at the then prevailing interest rates on AAA rated municipal debt, out of payments received by Englewood under this Agreement in excess of $100 ,000 per year. If a mutually agreeable aJTangement cannot be established , then Englewood may elec t either to pay its proportionate share of the costs and expenses of construction of the facility or facilities and participate in the facility or facilities or not to participate in the facility or facilities 16 . Capital Improvements to City Ditch Facilities. P :\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement .doc 25 16. l Improvements to City Ditch and/or Enelewood City Ditch Pump Station. Centennial may construct improvements to City Ditch (such as replacing the Marcy Gulch siphon to increase its capacity) or to the Englewood City Ditch Pump Station (such as removing the intake manifold and constructing a wet well), at its sole cost and expense, and upon approval by Englewood of plans and specifications for such improvements, which approval shall not be unreasonably withheld. Englewood may, during the term of this Agreement and at its sole discretion , acquire such improvements from Centennial by reimbursing Centennial for the costs and expenses of construction of such improvements, plus CPJ adjustment as described in paragraph 18 .1 below, less depreciation under an agreed upon depreciat~on schedule for such improvements. Centennial shall have the first right to use the increased capacity resulting from any such improvement which has not been so acquired by Englewood . Such first right to use shall not extend to any other portion of the City Ditch or of the Englewood City Ditch Pump Station. For example , if Centennial were to enlarge the capacity of a given portion of City Ditch by 10 cfs , and thereby establish its prio ri ty of usage of this 10 cfs , said enlargement by Centennial would not entitle Centennial to any priority of usage of the Englewood City Ditch Pump Station , if such pump station capacity were limiting at a given time. Englewood shall operate such improvements whether owned by Centennial or acquired by Englewood. 16.2 Separate New Facilities on City Ditch. Centennial may construct separate new facilities on City Ditch which will principally benefit Centennial (such as a pump station along City Ditch between Chatfield Reservoir and the Englewood City Ditch Pump Station), at its sole cost and expense, and upon approval by Englewood of plans and specifications for such facilities, which approval shall not be unreasonably withheld. Centennial shall have the first right to use such facility and Englewood shall have the right to use any excess capacity in the facility . The availability of excess capacity shall be determined solely by Centennial. Centennial shall maintain such facility. Englewood will operate such facility as directed by Centennial to dive11 and/or pump Centennial's water through such facility, consistent with Centennial 's rights to capacities in the City Ditch and the Englewood City Ditch Pump Station under this Agreement. 17 . Capital Improvements to Nevada Ditch Facilities. Any improvements to Nevada Ditch facilities by Centennial will be made in accordance with the Nevada Ditch Holding Company bylaws and subject to Englewood 's prior approval of plans and specifications , which approval will not be unreasonably wi thheld. 18 . Adjustment of Payments. The payments by Centennial to Englewood, as set forth above in paragraphs 8.7 , 12.4, 13 .3.12 and 13.7 , shall be adjusted annually as of January 1 of each year in accordance with the following provisions . The adjusted payments shall be the adjusted payments determined using the CPI Basis for adjustments , as hereinafter described , unless the Appraisal Basis for adjustments, as hereinafter described, is elected by one of the parties . 18. 1 · CPI Basis for Adjustments . The CPI Basis for adjustment of payments shall mean an adjustment of each of the payments set forth above either upward or downward in proportion to changes in the Consumer Price Index, All Urban Consumers, Denver-Boulder- P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreementdoc 26 Greeley Area, All Items, as published by the U.S. Bureau of Labor Statistics (the Index). The Index .is cun-ently published for the first half of each year and for the second half of each year. The adjustment shall be made as follows: the initial Index shall be the Index for the second half of 2002. Beginning with the year 2004, the payments shall be increased or reduced each year in proportion to the change in the Index between the second half of the previous year and the second half of the year prior to the previous year. It is acknowledged that the Index for the second half of each year will not be available until after January of the subsequent year, and an adjustment between the parties to con-ect the interim payments shall be made within 30 days after the Index for the requisite second half of the year is published, and thereafter all payments shall be made pursuant to the revisions necessitated by the newly-published Index. If the described Index ceases to be published , the parties shall seek to agree upon a reasonable substitute index; and if such agreement cannot be reached, the substitute index shall be the most comparable and recognized cost of Jiving index then being published. 18.2 Appraisal Basis for Adjustments. The Appraisal Basis for adjustment of payments shall mean an adjustment of each of the payments set forth above either upward or downward to the appraised value of the water deliverable or the leasehold interest under the terms of this Agreement. The Appraisal Basis for adjustment of payments shall be used no more often than once every S years and only if one pai1y gives written notice to the other party of the notifying party's desire to have an appraisal made of water value and/or leasehold value within 60 days after notice from one party to the other party of the adjusted payments for the ensuing pe1iod as determined using the CPI Basis for adjustment. If such notice is given, the parties shall promptly thereafter cause an appraisal to be made of the values of the water deliverable and/or the leasehold interests under this Agreement. The appraisal shall be made by an appraiser or by appraisers who are competent and recognized appraisers of the value of water and/or leasehold interests and the fees and expenses of the appraisers shall be shared equally by the parties. The parties shall seek to agree on a single appraiser. If the parties cannot agree within 30 days upon a single appraiser, either party may designate a competent and recognized appraiser by notice to the other party and the other party shall, within 30 days thereafter, designate a competent and recognized appraiser by notice to the first party. Within 30 days after the designation of the second appraiser, the two appraisers so designated shall select a third competent and recognized appraiser. As soon as practicable after the designation of the single appraiser or of the three appraisers, the single appraiser or the three appraisers shall submit to the parties appraisals of the values of the water deliverable and/or the leasehold interests hereunder. If there is a single appraiser agreed upon by the parties, the appraised values determined by that appraiser shall be deemed the appraised values of the water and/or leasehold interests. If there are three appraisers, the appraised values of water and/or leasehold interests hereunder shall be the appraised values for any category of water and/or leasehold interests agreed upon by any two of the appraisers or, if no two of the appraisers agree, the appraised values of water and/or leasehold interests hereunder shall be the average of the appraised values for any category of water and/or leasehold interests of each of the three appraisers. Pending completion of the appraisal, Centennial shall make payments at the prices determined using the CPI Basis for adjustments. Upon completion of the appraisal, Englewood shall refund amounts, if any , paid by Centennial in excess of the payments determined using the Appraisal Basis for adjustments, or Centennial shall pay the additional amounts , if any, due to Englewood under the payments determined using the Appraisal Basis for adjustments . P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 27 18.3 Instructions to Appraiser(s). The appraiser(s) is instructed to value the following items on the basis of their fair market values. Fair market value, as used in this Agreement, is defined to be the most probable price paid by a knowledgeable buyer to a knowledgeable seller under conditions in which neither the buyer nor the seller is operating under compulsion or duress, given a reasonable time for the transaction to be concluded. 18.3.1 Storage Capacity in McLellan Reservoir. The annual lease value for the 15.15 percent of the storage capacity in McLellan Reservoir which is leased to Centennial is to be valued at its fair market value for use for municipal purposes. 18.3.2 High-Priced Water. The appraiser(s) will calculate the lease price per acre-foot of High-Priced Water using the following equation : Lease Price for High-Priced Water= (Threshold x Value -Annual Lease Value for 900 Acre- Feet of Storage in McLellan Reservoir)/Threshold. Where: "Threshold" is the maximum amount of High-Priced Water in the current year (i.e., at the time of the appraisal) in acre-feet; "Value" is the fair market lease or rental value in dollars per acre-foot for a highly dependable municipal supply water supply; and Annual Lease Value for 900 Acre-Feet of Storage in McLellan Reservoir is the current year's payment under paragraph 13.3.11 , unless there is also an appraisal in the current year of the annual lease value for storage capacity in McLellan Reservoir, in which event the Annual Lease Value for such 900 acre-feet shall be the amount calculated using the unit value per acre-foot for storage capacity in McLellan Reservoir as determined by the appraiser(s) for the current year using the appraisal method described in paragraph 18.3.1. 18.3.3 Medium-P1iced Water. The appraiser(s) will determine the unit value per acre-foot for Medium-Priced Water on the basis of its average availability over a number of years, with the possibility of little or no availability in a single year. 18 .3.4 Low-Priced Water. The appraiser(s) will determine the unit value per acre-foot for Low-Priced Water on the basis of its availability on a short term basis without the ability to plan for its use more than a sho11 time in advance of its availability. 18.3.5 Reuse Rights . The appraiser(s) will determine the unit value per acre-foot forthe reuse rights, if any , associated with High-Priced Water, Medium-Priced Water and Low-Priced Water by (1) reviewing Englewood's decrees to determine which of Englewood's water rights are reusable and (2) reviewing records of Englewood 's delivery of reusable water to Centennial. P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 28 18.3 .6 Paid Deliveries Water. The appraiser(s) will determine the value of the Paid Deliveries Water as the sum of three components: (1) the amount per acre-foot charged by Denver to Englewood, pursuant to the 1995 Englewood/Cyprus/Denver Agreement; and (2) the cost per acre-foot to Englewood of pumping such water from City Ditch to McLellan Reservoir, if such water is pumped to McLellan Reservoir, or the amount charged per acre-foot to Englewood by Denver or by the Nevada Ditch Holding Company, if such water is delivered to Centennial through the High Line Canal or the Nevada Ditch, respectively; and (3) a fixed charge per acre-foot to be paid by Centennial to Englewood. The appraiser(s) will only determine the value of item (3), above , i .e., the fixed charge per acre- foot to be paid by Centennial to Englewood. The appraiser(s) will determine the unit value of the fixed charge by considering the 1995 Englewood/Cyprus/Denver Agreement, records of Denver's delivery to Englewood of the Paid Deliveries water, and the reuse rights associated with the Paid Deliveries Water. 18.3.7 Lease of Facilities. The appraiser(s) will determine a single annual lease value for the City Ditch Facilities and the Nevada Ditch by reviewing records of Centennial's use of these facilities pursuant to this Agreement, and by recognizing the variable nature of the availability of such facilit ies for use by Centennial. 19. Centennial Right of First Refusal to Purchase Ern!lewood Water Rights or Raw Water Facilities. If, at any time during the term of this Agreement, Englewood desires to sell any of its water rights or raw water facilities , including but not limited to those listed below, Centennial shall have the right to purchase such water rights or raw water facilities on the same terms and conditions as Englewood shall be willing to sell the same to any other party. The foregoing shall not be construed to authorize Englewood to sell, or to require Centennial to purchase any water rights or water facilities which are necessary or desirable to assure the delivery of water as required under this Agreement , or to abrogate, limit or subordinate the rights of Centennial under this Agreement if Centennial does not exercise its right of first refusal. 19.l Englewood Raw Water Facilities. The Englewood raw water facilities that are subject to this paragraph 19 include , but are not limited to, McLellan Reservoir, City Ditch , Englewood City Ditch Pump Station, McLellan Reservoir Discharge Facility, Bear Creek Pipeline (from Clay Street to Englewood's river reservoir at Union Avenue intake), any Englewood groundwater wells and appurtenant facilities intended to withdraw groundwater from the Denver Basin , Nevada Ditch , future raw water transmission facility (from the vicinity of Englewood's Union Avenue Intake or Allen Treatment Plan to the vicinity of McLellan Reservoir). P:\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 29 19 .2 Procedures. In the event Englewood desires to se ll any of its water rights or raw water facilities , then Englewood shall deliver to Centennial notice of its desire to sell, which shall include the following information: A. The identity of the asset to be sold; B . The price to be received, and the terms of payment of the price; C. The state of title to th e asse t to be conveyed , including any liens or encumbrances; and D. Such other information or conditions of the sale, if any, which Englewood may choose to include. During a period of 60 days following the date of receipt of such notice, Centennial may deliver to Englewood notice that Centennial will purchase the asset described in Englewood 's notice on the price , term s and other conditions described in Englewood's notice. If Centennial's notice is so delivered, then the parties shall close the purchase of the particular asset at a time and place reasonably se lect ed by Englewood , no sooner than 60 or more than 90 days after the date of deli very to Englewood of Centennial' s notice. Appropriate signed conveyance instruments shall be delivered at closing, together with readily available purchase funds and any note or other obligation for deferred pa yments . If Centennial fails to deliver timely notice as above provided , then for a period of 548 days following the expiration of th e 60 day period for Centennial's notice , Englewood may sell the asset for a price no Jess than 95 per cent of that stated in Englewood's notice to Centennial, and upon terms no less favorable to Englewood than those stated in such notice . If Englewood wishes to sell for a price which is Jess than 95 per cent of that stated in such notice to Centennial, or on Jess favorable terms , then Englewood must recommence the notice process described herein . 20. Mutual Cooperation. It is anticipated that Centennial and Englewood will work together and use their best efforts to enter into further and ancillary agreements relating to the construction , operation and maintenance of facilities which would enhance the availability and quality of water for both Englewood and Centennial. However, such further or ancillary agreements s hall be separate and distinct from this Agreement and this Agreement shall not be conditioned in any way upon the entering into by either party of any such future or ancillary agreements. 21. Reversion of Leased Water to Englewood. At any time during any year, by mutual agreement, Centennial may return to Englewood water actually delivered by Englewood to Centennial under this Agreement. Englewood shall pay to Centennial for the water returned to Englewood th e same price which Centennial paid Englewood for s uch water. If the water so returned to Englewood is reusable water, all rights of reuse shall also revert to Englewood . 22. Default and Remedies . If either party shall fail to keep or perform any agreement on its part to be kept and performed according to the terms and provisions of this Agreement and the other party gives notice specifying the particular default or defaults, the party in default shall have such period of time as provided in said notice , which period of time shall in no event be less P :\dianas\AGMTS \2003Wate rFacilitiesSupplyAgreement.doc 30 than 90 days, in which to coJTect such default or defaults, or institute action reasonably calculated to correct such default or defaults. Due to the uniqueness of the subject matter of this Agreement, the inadequacy of legal remedies, the extreme difficulty which may be experienced in calculating damages, and the impossibility of returning the parties to the conditions that existed at the time this Agreement was made, the non-defaulting party shall have the right to specific performance as a remedy. Waiver or failure to give notice of a particular default or defaults, shall not be construed as condoning any continuing or subsequent default. If either party should contest any action pursuant to this paragraph in court , this Agreement shall remain in effect pending a determination by the court in said action. Notwithstanding the foregoing provisions of this paragraph 22, if either party fails to pay a liquidated sum of money, then the other pai1y may give the defaulting party written notice of the default, and if the default is not coJTected within 20 days after the date of receipt of the notice , then the non-defaulting party may, at its election , terminate this Agreement by notice delivered to the defaulting pai1y within 30 days after expiration of the 20 day period. A liquidated sum means a sum which is fixed or can be readily calculated under this Agreement, and as to which there is no dispute that the sum is due. An example would be a failure to pay a fixed annual lease payment when there is no dispute that the amount is due. The prevailing party on any claim of breach or default shall be entitled to recover from the other party its reasonable attorneys fees, costs and other expenses related to the claim on which it prevailed. 23. Notices. Except as otherwise expressly provided in paragraph 10.3.1, all notices, consents or other instruments or communications provided for under this Agreement shall be in writing, signed by the party giving the same, and shall be deemed properly given and received when personally given and received, or three business days after mailing, if sent by registered or certified United States mail, postage prepaid , addressed to a party at its address set forth below or such other address as such party may designate by written notice to the other party: To Englewood: To Centennial: Director of Utilities City of Englewood 1000 Englewood Parkway Englewood , CO 80110 General Manager Centennial Water and Sanitation District 62 West Plaza Drive Highlands Ranch , CO 80129 24 . Assignment by Either Party. Absent prior written consent by Englewood, which may be withheld without cause, Centennial may not assign its rights or obligations hereunder except to a successor entity which serves water only to the Centennial Service Area described in paragraph 7 .1. Absent prior written consent by Centennial, which may be withheld without cause , Englewood may not assign its rights or obligations hereunder provided, however, that Englewood may assign to a governmental or quasi-governmental provider of water for municipal P:l dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 31 purposes which has sufficient financial strength and water resources to provide at least as much water to Centennial as Englewood is reasonably likely to provide. 25. Binding Effect. The term s and provisions of this Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns, provided any assignments are made in accordance with paragraph 24. 26. No Third Party Benefici aries. None of the terms or provisions of this Agreement shall be deemed to be for the benefit of any person or pa11y other than Centennial and Englewood. 27. Entire Agreement. Thi s Agreement constitutes the entire understanding between the parties with respect to the subject matter hereof and all prior agreements or understandings shall be deemed merged herein . No representations, wan-anties or certifications, express or implied, shall exist as between the partie s except as stated herein . 28. Modifications in Writing. No amendments, waivers, or modifications hereof shall be made or deemed to have been made unless in writing executed by the party to be bound thereby. 29. Severability. If any provi s ion of this Agreement shall be invalid, illegal or unenforceable , it shall not affect or imp air the enforceability of any other provisions of this Agreement. Englewood will vigorously defend any attack on the ability of Englewood to deliver water under this Agreement to Centennial for use by Centennial, and will encourage Centennial to join in the defense. Despite potential participation in the case by Centennial, Englewood shall have the sole right to settle the litigation , but only after reasonable consultation with Centennial and receipt and consideration of Centennial' s views on settlement. If an adverse judicial ruling is received , or an adverse settlement i s made , with respect to the ability of Englewood to deliver water derived from any Englewood water right or contract right pursuant to this Agreement to Centennial for use by Centennial, then Englewood in its sole discretion shall determine whether to attempt to amend any applicable Englewood decrees or contracts or take other steps to ameliorate the impact of the adverse event. However, Englewood shall reasonably consult with Centennial concerning its course of action , prior to reaching any final conclusion. If Englewood decides not to take action to enable delivery to and use by Centennial under the disputed water right or contract, then Englewood may provide the water in question to others, free of any of the constraints established by this Agreement ; provided, however, that prior to making a final decision to provide the water to others , Englewood shall reasonably apprise Centennial of the terms , conditions and circumstances under which it will provide the water to others , and provide Centennial with a 30 day period within which to propose a methodology whereby approximately the same quantity of water could be provided in s tead to Centennial. Englewood shall be under no obligation to accept such a methodology, but shall afford reasonable and careful consideration to Centennial's proposal. 30. Applicable Law. This Agreement shall be interpreted and enforced according to the laws of the State of Colorado. P :\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 32 31 . Headings and Captions for Convenience. All headings and captions used in this Agreement are for convenience only and are of no meaning in the interpretation or effect of this Agreement. 32. Term and Renewals of Agreement. 32 .l Term of Agreement. The term of this Agreement shall include the Initial Term and , if the renewal options hereinafter specified are exercised , the Renewal Terms, all as hereinafter specified. 32.2 Initial Term . The "Initial Term " of this Agreement shall be 20 years commencing January 1, 2003 and extending to midnight on December 31 , 2022. 32.3 Renewal Options. Centennial shall have the option to extend the Initial Term of this Agreement for up to four additional successive 20-year periods . The First Renewal Term shall commence on January 1, 2023 and extend until midnight on December 31, 2042. The Second Renewal Term shall commence on January 1, 2043 and shall extend until midnight on December 31 , 2062. The Third Renewal Term shall commence on January 1, and shall extend until midnight on December 31 , 2082. The Fourth Renewal Term shall commence on January 1, 2083 and shall extend until midnight on December 31 , 2102 . 32.4 Proc edures for Renewal. Centennial shall exercise the options to renew the term of this Agreement by giving Englewood notice of the exercise of the option at least one year before the next Renewal Term is to commence. lt is recognized that , due to the long term nature of this Agreement, there may be an inadvertent failure of Centennial to give timely notice of Centennial's desire to extend the term of this Agreement. Accordingly, if Centennial fails to give notice to Englewood of its desire to exercise any option to renew , Centennial shall, in any event, be required to give such notice within 30 days after a notice from Englewood to Centennial advising Centennial that Centennial has failed to give notice of its intent to exercise its option to renew. If, through inadvertence or otherwise, neither party gives a notice , this Agreement shall automatically continue on a year-to-year basis. If Englewood subsequently gives notice and Centennial fails to exercise its option to renew within 30 days after such notice, this Agreement shall expire on midnight of December 31 of the year in which such notice is given by Englewood , provided such notice is given to Centennial at least 30 days prior to such December 31 . 33. Condemnation. If either party commences an eminent domain proceeding to acquire property of the other including , but not limited to , property in the name of or held by a ditch company in which a party holds shares , then the condemnee or holder of the ditch company shares may terminate all or any part of this Agreement at such time or times as the condemnee chooses , by notice to the condemnor. The term "prope11y " includes , but is not limited to, easements , rights of way, leaseholds, c aniage capacity in water conveyance facilities, storage rights in reservoirs , water rights , rights to receive water, and other contractual rights. 34 . Counterpai1s . This Agreement may be executed in com1erparts, all of which taken together shall constitute one and the same Agreement. P :\dianas\AGMTS\2003WaterFacilitiesSupplyAgreement.doc 33 IN WITNESS WHEREOF, this Agreement is executed to be effective as of the day and year first above written. CITY OF ENGLEWOOD Mayor Attest: City Clerk P:\dianas\AGMTS \2 00 3WaterFacilitiesSupplyAgreement.doc 34 CENTENNIAL WATER AND SANIT A TJON DISTRICT Chairman Attest: Water Supply and Facilities Agreement Exhibit "A" Payments Due from Centennial to Englewood \Vater SuppJy and FaciJities Agreement Exhibit "B" Outsjde Cjty of EngJewood Water Servjce Areas The City of Englewood serves treated water to the following areas outside of its municipal boundaries: The Cherryhills Rancho area , roughly bounded by S. Lafayette Street extended on the east to S . Clarkson St. on the west , and U.S. Highway 285 on the north to E. Oxford Lane on the south: 68 accounts, Along S. Clarkson Street from E. Quincy Ave. south to E. Belleview Ave.: 16 accounts , E. Radcliff Ave. east of S. Clarkson St.: one account, E . Stanford Ave . east of S. Clarkson St.: 5 accounts, E. Tufts Ave. east of S . Clarkson St.: one account, Viking Drive east of S . Clarkson St.: 15 accounts , and Centennial Acres bounded by W . Belleview Ave. on the north, W. Berry Ave. on the south, S. Irving St. on the east and S. Lowell Blvd. on the west: 307 accounts. The total count for outside city accounts is 413. l ~ ', .. 1 J) :· ~ .. ' ... ~. ·. , ,.-, , ;r 't; , , ,· . .._,,j 1,r ';,,>Ill.\ .-_,.~,.~"·~- ' r:~-, ~·.··~ : '·ls~; ,~~>;:-,,hi~ f ~ l\. '. ' .. ,;; 'l :. ! ! I'< J -.,.::;t .•• ~ . ~ 1 );I ,;.:: ·' l , ' ·\/C' "; .. 1' 3,500 7 ,000 N W+E s Legend 1222] Area to be Served by Englewood Water Area to be Served by Englewood Water 0 Fe et Year 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 Water Supply and Facilities Agreement Exhibit D Example Calculation Values in These Columns Computed in Ja nuary of the Current Year, Based on Previous Values These Col umns May Not be Known Until End of Year Ann ual En d of Year End of Year End of Year 10 year 10 yea r Threshold Threshold Reduce Increase Contract High Priced Medium Priced Low Priced Mi nimum Average Sum Buffer Amount Threshold Th res hold Threshold Wate r Water Water Water 1500 NOT ES All Values in Acre Feet 1500 1500 Years 2003 through 2015 are assumed to be the Threshold Initiation Period . For these years, 1500 the threshold is set by agreement, not calculation, assuming annual contract water in each 1500 of these years equals or exceeds contract amounts. 1500 1500 1500 1500 1500 1500 1500 1500 0 0 0 1600 2000 1600 0 400 1500 1550 2000 400 0 0 1700 2200 1700 0 500 1500 1620 2600 900 0 0 1800 2500 1800 0 700 1500 1720 3400 900 0 0 1800 2700 1800 0 900 1500 1840 3600 900 0 0 1800 2600 1800 40 760 1500 1950 3500 900 0 0 1800 2500 1800 150 550 1500 2050 3400 900 0 0 1800 2600 1800 250 550 1500 2160 3500 900 0 0 1800 2400 1800 360 240 1500 2250 3300 900 0 0 1800 2500 1800 450 250 1500 2350 3400 900 0 0 1800 2800 1800 550 450 2000 2480 3700 900 0 0 1800 2600 1800 680 120 2200 2540 3500 900 0 0 1800 2700 1800 740 160 2400 2590 3600 900 0 0 1800 2700 1800 790 110 2400 2610 3600 900 0 600 2400 2500 2400 100 0 2400 2590 3400 900 0 0 2400 2500 2400 100 0 2400 2580 3400 900 0 0 2400 1200 1200 0 0 1200 2450 2100 0 (300) 0 2100 800 800 0 0 800 2270 800 0 (1300) 0 800 100 100 0 0 100 2040 100 0 (700) 0 100 800 100 700 0 100 1870 800 700 0 0 100 1100 100 1000 0 100 1700 1800 900 0 0 100 1300 100 1200 0 100 1570 2200 900 0 0 100 1400 100 1300 0 100 1440 2300 900 0 0 100 1600 100 1340 160 100 1330 2500 900 0 0 100 1400 100 1230 70 100 1220 2300 900 0 0 100 1300 100 1120 80 100 1100 2200 900 0 0 100 1800 100 1000 700 100 1160 2700 900 0 0 100 2000 100 1060 840 100 1280 2900 900 0 0 100 2200 100 1180 920 800 1490 3100 900 0 700 800 2100 800 690 610 1100 1620 3000 900 0 300 1100 1800 1100 520 180 1300 1690 2700 900 0 200 1300 2600 1300 390 910 1300 1820 3500 900 0 0 1300 2700 1300 520 880 1300 1950 3600 900 0 0 1300 2500 1300 650 550 1300 2040 3400 900 0 0 1300 2600 1300 740 560 1300 2160 3500 900 0 0 1300 2700 1300 860 540 1800 2300 3600 900 0 500 1800 2800 1800 500 500 1800 2400 3700 900 0 0 1800 2500 1800 600 100 ""' <.-{ ~ / ' '·" i Water Delivery Measurement Points 1. City Ditch Pump Station: Meter on discharge piping I ,".i l 1· .. , ~·¥. ,, {·; N 2 . Nevada Ditch Flume: Flume between turnout structure off ditch and So. Platte Res . pump station forebay W+E 3. Last Chance Ditch Flume: Flume between turnout structure off ditch and So. Platte Res . s 0 1,000 2,000 4 . Dad Clark Gulch Flume : Dad Clark Gulch downstream from Highline Canal turnout structure 5. Dad Clark Gulch Meter: Meter installed in 36" pipe under Highway C-470 6 . Highline Canal Gate No. 29 + 427' Feet .. ~I <::)'"··· q// CJ • ~· "'l'/J'f. .•. (j"· JI;; t ~'." • ;/»-!' !: ; 0f Jlf i .. .;J: j/·" ! • • -~ ~ Legend ( \.:w (>.• -!:::) ~· ....... cs· 01'/Jz / ~<?:i···' . ~'o/ r~ i t" i·:.;;~~ Water Supply and Facilities Agreement Exhibit F ~=~-l-- Centennial's Pipelines Englewood's Pipelines City Ditch Last Chance Ditch Nevada Ditch Dad Clark Gulch .,_ General Features 't +tr .,,.,..,,,.. Joseph B. Blake Water Treatment Plant N W+E s 0 1,000 - Feet ,' .. 1 3: -....,' ~ 2 ,000 Water Supply and Facilities Agreement Exhibit "G" 1995 Englewood/Cyprus/Denver Agreement Paragraph 3.3.5 1 J A v .i l;f SETTLEMENT AGREEMENT This Agreement made and entered into this//:!._,, day of ~ 1995, ·by and ·between the CITY AN_D COlT.NTY OF DENVER, acting by · and through its BOARD OF WATER COMMISSIONERS ("Denver"), THE CITY OF ENGLEWOOD ("Englewood") , and CYPRUS CLIMAX METALS COMPANY r ("Cyprus") (collectively, the "parties"), WITNESSETH: WHEREAS, the ·City of Englewood owns water rights decreed in C.A. 657 and Case No. W-750-78 ("Cabin-Meadow Creek Water Rights'') which divert from tributaries of the Fraser River in Water Division Number 5 for municipal use; and WHEREAS, Denver owns and operates a water collection system which diverts water under its water rights from the Fraser and Williams Fork River basins for municipal use; and WHEREAS, Cyprus, through its wholly-owned subsidiary, Climax Molybdenum Company, ~wns and operates the Henderson Ore Reduction Plant ("Hendersori Mill") located in the Williams Fork valley, which processes ore from the Henderson Mine. Cyprus .needs a firm water supply to insure its ability to process ore at maximum production capacity during periods of drought; and WHEREAS, Denver and Englewood entered into a Water Exchange Agreement dated March 17, 1964 ("1964 Water Exchange Agreement''), and Denver, Englewood and Cyprus entered into a Modification of the Water Exchange Agreement dated September 2, 1969 ("1969 Modification"), under which Denver carries Cabin-Meadow Creek system water through its water system and delivers, by trade or exchange, water to Englewood on the South Platte River for municipal use within the Englewood Service Area, and also operates its Williams F.ork System to provide water to Cyprus on the Williams Fork River for use in the Henderson Mill. Englewood, Cyprus and Denver agreed to share the yield of water produced by the Cabin-Meadow Creek Water Rights; and WHEREAS, Englewood and Cyprus entered into an agreement dated September 25, 1969, as amended on September 26, 1969, whereby Englewood and Cyprus agreed to jointly develop the Cabin Meadow Creek Water Rights and to share all costs connected W·i th the development, operation and maintenance of the Cabin Meadow Creek System; and WHEREAS, Englewood developed with Cyprus' assistance a collection system ("Cabin-Meadow Creek System") by which to divert and carry water diverted under the Cabin-Meadow Creek Water Rights; and Denver's ciecrees. When water from Reusable Sources is physically ~vailable at the time of deli very, Denver shal J ae11 ver sucn water. If these Reusable Sources are not available, Denver sha ll deliver from storage other.municipally ciecreed sources available to Denver. The determination of which storage sources are available is within the sole discretion of Denver. Nothing in this Agreement shall be construed a~ creating any obligation on Denver to have Reusable Sources in its system or requirin~ Denver to operate the Roberts Tunne l i n any manner. 3 .3.~ No carr v -ov er. Englewood must take Pa i ci De li veries before J ul y j of the y ear of designa~ion. Eng l ewood shal l for f eit an y Paici De l iveries designateci anci made ava il able by Denver but not ta ken before July l . An y forfeiteci Paid Deliver i es shal l be retained b y Denver for its sole and exc l usive use. Eng l ewood is no t required to pay for uncielivered Paici De l iveries; however, a ll Paic Deliveries designated b y Den v er count aoa i nst the amounts set forth ir. 3. 3 .1. 3.3.: Denver Operation of CMC Exchanaes. Denver may operate in-priority exchanges under the decrees in C.A. 3635, case No. W-8783-77 or Case No. W-8456-7 6 ("Exchange Decrees") using water introduced into the South Platte River Basin froffi Englewood's CMC Water Rights or Denver's water rights decreec from the same sources tc the Moffat Tunnel Collection Systerr. in C.A. 1430 ("CMC Exchanges"). CMC Exchanges may be performed by Denver only between May l and August 31, and may be performed only when calls are being administered for senior water rights of others on the South Platte River below the point (s ) at which CMC Exchange water is delivered into the south Platte River mainstem to satisfy the calling water right or to otherwise satisfy senior downstream water rights. Denver's diversions and storage from the South Platte River under CMC Exchanges shall be limited to the lesser of (a) 95 cf s or (b) the amount of water called for by downstream senior rights on the South Platte mainstem during operation of the CMC Exchanges. Under the Exchange Decrees, any CMC Exchanges tc Chatfield Reservoir shall be operated under an administrative date of 1976 or 1977 and to Strontia Springs Reservoir under a priority of 1962. Englewood, and any entity who is entitled to receive the Paid Deliveries pursuant to a written contract with Englewood specifically for use of the Paid Deliveries ("Contract Users of Paid Deliveries"), shall not object in any forum or manner to operation of CMC Exchanges by Denver in accordance with this Agreement. For purposes of this paragraph 3.3.5, Centennial Water and Sanitation District ("Centennial") under the 1977 Lease Agreement or 1980 Water Supply Agreement, shall not be considered a Contract User of Paid Deliveries unless it 8 314 44 is entitled under an amendment or new agreement to receive alJ Paid Deliveries. Before any entity including Centennial is made a Contract User of Paid Deliveries that entity must agree to abide by this paragraph 3.3.5. 3.4 Schedule of deliveries. Denver shall make Basic and Paid Deliveries uncier the procedures set forth in Exhibit A. Denver shalJ only make available Paid Deliveries during the period May J throuch June 30 under the procedures set forth . in Exhibit A. Engle~ood is solely responsible for coordinating any Basic and Paid Del iv eries to its lessees or users . Englewood shall not request Basic or Paid Deliveries if the water is not neecied for municipa l purposes by it or its lessees or users. 3.= Point of Delivery . Water designated by Denver under this Article Il l shall be measured and delivereci into the South Platte River into or below either Strontia Springs Reservoir or Chatfield Reservoir , at Englewood's request. Stream or ditch carriaqe .i os ses, if any, between the point of deli very and any other downstream points of diversion are to be absorbed by Englewood. 3.6 Type of Water. Water delivered to Englewood under this Article Ill shall be decreed for municipal use and shall be lawfully available for storage. Denver may deliver to Englewood water decreed either for direct flow or for use by exchange onl y with Englewood's consent. Except as described in this Section 3.6, however, Englewood takes the type of water "as is" with respect to Denver's decrees. Nothing in this Agreement shall be construed to require Denver to change its decrees. 3. 7 Use of Delivered Water. Water delivered to Englewood shall be used only for municipal purposes within the Denver metropolitan area and shall be used consistently with Denver's decrees. Article IV Cyprus-Denver Provisions 4.J Cabin-Meadow Creek water. Denver shall have the right to use, reuse, successively use and dispose of all waters produced by the CMC Water Rights and CMC System for any municipal use by Denver 's customers in the Denver metropolitan area consistent with the Decree entered in Case No. W-750-78. 4. 2 Amount of Water Provided to the Henderson Mill. While the Henderson Mine is in operation, Denver's Williams Fork System shall be exercised so as to provide up to 3,000 acre feet of water from the Williams Fork River and its tributaries for diversion and use at the Henderson Mill (the "Cyprus Credit"); provided that no more frequently than once during any ten consecutive Water Years, Denver may, by Apr±l 20 of the Water Year, notify Cyprus that only 9 conditions that existed at the time of this Agreement, the non- defaulting party(ies) shal l have the right to specific performance as a remedy. Waiver or failure to give notice of a particular default or defaults under this Section shall not be construed as condoning any continuing or subsequent default. 8 .18 Term. This Agreement is perpetual, except for the provisions concerning ·Cyprus which shall terminate when the Henderson Mine ceases operat ion under Article II. ATTEST: APPROVED: Lega~nS '.f~ \_ ATTEST: ;1..,'T. Secretary 26 CITY AND COUNTY OF DENVER acting by and through its BOARD OF WATER COMMISSIONERS By:~;:U Pr esident REGISTERED AND COqNT~RSIGNED Donald J. Mare.s ,. Au9 ·i tor /, L t /,~ /· .............--/& / CYPRUS CLIMAX METALS COMPANY By: '?~- i;.L. lJ1~ ;f I \ j ·-...,. Water Supply and Facilities Agreement Exhibit H j,,., ' *'~t ,, "~ --~ -··~;.;.,.,.: .. >"·. ,_ +<ilf -~~4 /• / ,, Englewood Physical Facilities in Which Capacity is Leased to Centennial fZ'/Z/l Mclellan Reservoir City Ditch from Chatfield Reservoir Ditch Outlet Manifold downstream to the City Ditch Pump Station Nevada Ditch from Chatfield Reservoir Ditch Outlet Manifold downstream to the turnout structure on the ditch at which water is delivered to Centennial Pipeline from Mclellan Reservoir to the Discharge Facilitiy, which is used both to carry water from the City Ditch Pump Station to Mclellan Reservoir and from Mclellan Reservoir to the Discharge Facility @ City Ditch Pump Station 8J Mclellan Reservoir Discharge Facility 0 N W+E s 1,000 2 ,000 ~ Feet Water Supply and Facilities Agreement Exhibit "I" Agreement between Englewood and Denver dated October 3, 1995 CITY DITCE/HIGB LINE CANAL AGREEMENT THIS AGREEMENT is made and entered into as of the~ day 0~1 1995, by and between the City and County of Denver, acting by and through its Board of Water Commissioners, a municipal corporation of the State of Colorado ("Denv er"), and the City of Englewood, a municipal corporation of the State of Colorado ("Englewood"). Recitals A. Englewood and Denver wish to arrange for delivery of water to each of them from a ditch owned by the other. Englewood desires deliveries from the High Lin e Canal, and Denver desires deliveries from the City Ditch. B. The High Line Canal ("High Line") is owned and operated by Denver. An outlet from the High Line is used by Englewood to supply water to Mclellan Reservoir. c. Englewood owns and operates the City Ditch from Chatfield Reservoir north to Harvard Gulch blow-off. Denver owns the City Ditch from Harvard Gulch north to its terminus. Englewood uses City Ditch to convey water for Englewood's use to Mclellan Reservoir and Allen Filter Plant, and also to supply various contract users who · divert from City Ditch south of Harvard Gulch. Denver uses deiiveries from City Ditch to supply water to parks and to contract users below Harvard Gulch. D. Denver's rights to deliveries from City Ditch at Harvard Gulch and Englewood's rights to deliveries from the High Line are contained in a series of contracts, but are due to expire on November 1, 1998. Denver and Englewood desire to extend the term of their respective rights to deliveries from City Ditch and the High Line. Therefore, the parties have agreed ~as follows: I. HIGH LINE CANAL 1.1 Deliveries to Englewood. Whenever Denver is running water in the High Line at least as far as the turnout to McLellan Reservoir, Denver shall divert at the High Line diversion dam not less than 5 cubic feet per second (cfs) and up to 60 cfs of Englewood's water. Englewood shall determine the amourit of its water to be diverted, up to a maximum of 60 cfs. Denver shall continue to operate the High Line for deliveries to contract users north of McLellan Reservoir under the 1879 High Line priority. 1.2 Notice. Denver shall give Englewood reasonable advance notice of the time when Denver will begin running water through the Hioh Line. When Denver notifies Englewood that water is running in the ~igh Line, Englewood shall give Denver 48 hours advance notice of the amount of its water to be diverted, including rate and duration of flow. Denver shall make all reasonable and practical efforts to comply with Englewood's directions concerning commencement time, rate and duration of flow. Denver has the right to terminate diversions of Englewood's water, so long as all diversions of water into the Hioh Line are terminated at the same time. 1.3 Measurement and Ditch Loss. Englewood shall bear a ditch loss of 16 per cent (16%) of its water, diverted at the High Line diversion dam, as measured at the gage adjacent to Platte Canyon Reservoir, for delivery to McLellan Reservoir. The deliveries of Englewood's water will be measured at the gage on Dad Clark Gulch between the High Line and McLellan Reservoir. for example, if 60 cfs is diverted for Englewood at the diversion dam, 50.4 cfs shall be delivered through the Dad Clark gage. In the event that any improvements are made to the High Line which decrease its seepage losses, the amount of ditch loss which Englewood must bear shall be appropriately reduced. 1.4 Waiver by Denver of Ditch losses. Notwithstanding paragraph 1.3, Denver shall, to the extent legally permissible, waive the 16% carriage loss when Denver is carrying Englewood's water in the High Line along with water diverted by the High Line 1879 priority; provided that, Denver is not prohibited, for reasons beyond· its control, from constructing the improvements proposed in paragraph 2.1.2. Englewood shall continue to bear the 16% carriage loss whenever Denver is not diverting under the 1879 High Line priority (i.e. the Antero Contract Run). Whenever the 16% carriage loss is waived, Denver's maximum diversion and delivery rate for Englewood shall be reduced from 60 cfs to 50 cfs. 1.5 Water Quality. Denver makes no warranty as to the quality of the water delivered to Englewood, and Englewood will accept same "as is". 1.6 Maintenance Responsibility. Denver shall operate and maintain the High Line for delivery of Englewood's water to McLellan Reservoir. Englewood shall pay a proportionate share of operation and maintenance costs as described in paragraph 1.7. Englewood shall maintain the present measuring flume at the McLellan Reservoir turnout, at Englewood's sole expense. 1.6.l Shut-off of deliveries. Denver shall perform any maintenance work requiring either a complete or partial shut-off of deliveries in the High Line with the utmost expediency to minimize water losses. Except in emergency situations, Denver shall notify Englewood of all complete or partial shutoff at least 48 hours in advance. 1.6.2 Annual Inspection. Representatives of Englewood and 2 Denver will perform annual Joint inspections of the High Line to determine maintenance work required to continue to deliver the rates of flow set forth above. The inspection of the High Line will be limited to the reach between the South Platte River diversion dam and the McLellan Reservoir turnout. The annual inspection shall be made so that all required maintenance work will be completed, to the extent practical, prior to April 1. 1 .7 Enalewood's Share of Hiah Line Expenses. Englewood shall pay a proportional share of the Board's annual High Line administration, operation and maintenanc e expenses(includina depreciation ) on that portion of the canal from and including the Hiah Line diversion dam to McLellan Reserv oir (a distance of 16 miles, more o r less). Denver will not ch arge Englewood for High Line capital costs, d efined as the construction of new physical structures o r :mcrcvements to existing structures th at will have a useful life of fi~e ye ars or more(except for deprecia tion which shall be included in operation and maintenance expense s and calculated under generally accepted accounting procedures consistently applied). Englewood's proportional share of those costs shall be based on the ratio of the volume of water diverted for Eng lewood at the High Line diversion dam to the total amount of water diverted by the High Line from the South Platte River. 1.7 .l Calculation. The computation of Englewood's share of costs shall be in accordance with the following formula: CE = ( 16/ 63. 6) x CH x ( QE/QH) . Where: 16 63.6 QH = CH = Length of the High Line in miles from the High Line diversion dam to the turnout for McLellan Reservoir on Dad Clark Gulch. Length of High Line in miles from High Line diversion dam to its terminus at the Rocky Mounta i n Arsenal turnout. This distance may change in the future~depending on Denver's operat i ons. Total an nual High Line diversion, in acre-feet as measured at the gage adjacent to Platte Canyon Reservoir. Total annual amount of Englewood water diverted or delivered into the High Line, in acre-feet, as measured at the gage adjacent to Platte Canyon Reservoir. The Board's total annual costs for 3 CE administration, operation and maintenance of the High Line (based upon actual miles operated by Denver) . Englewood's proportional sh.are of annual High Line costs. II. CITY DITCH 2.1 Deliveries to Denver. 2.1 .l Basic Deliver y . During the period of April l throuah October 31, inclusive, Englewood shall deliver to Denver through the Ci ty Ditch at Denver's request up to 10 cfs of water at Harvard Gul ch (measured at the Washington Park flwne) ("Basic Deliver y "). 2.1.2 Enlaroement of Basic Delivery. Upon replacement by Denver of approximately 100 lineal feet of 36 inch diameter corrugated metal pipe conveying City Ditch water between the street and alleyway adjacent to the residence at 3018 S. Grant Street, Englewood, Englewood shall deliver, at Denver's request, up to 13 cfs to Harvard Gulch, but no sooner than April 1, 1997. Denver shall also be responsible for improvernents,if any, to the City Ditch north of and including Hampden Avenue to enable the delivery of 13 cfs to Harvard Gulch. Englewood shall be responsible for any maintenance activities necessary to convey the 13 cfs to Harvard Gulch. All surveys, engineering and other studies, and construction in connection with any improvements shall be performed at Denver's sole expense. Englewood shall cooperate f~lly in allowing any necessary investigations and construction. No such construction, however, shall be performed without the prior written consent of Englewood, which shall not be unreasonably withheld. Denver shall comply with Englewood's reasonable design standards or criteria in making these improvements. After satisfactory completion of such replacement and improvements, Englewood shall deliver 13 cfs to Denver at Harvard Gulch, from April l through October 31 of each .year. Denver will allow Englewood until April 1 1997 to perform maintenance activities(including the removal of silt or debris) necessary to deliver the 13 cfs. 2.1.3 Location of Other Deliveries. Denver may require Englewood to deliver, through the City Ditch, any portion of the 13 cfs otherwise deliverable at Harvard Gulch to any existing delivery structure or structures south of Harvard Gulch for irrigation of parks, open space, and golf courses of Denver or its customers. Such deliveries shall be in addition to the deliveries which Englewood is already required to make to existino contract users south of Harvard Gulch. If Denver wishes ~o ·utilize new delivery structures, Denver shall pay to 4 '~ 1 ·· I I I I I Englewood the full cost of the construction of the new delivery structures. Englew ood shall perform the constructic~ ~~=~~; periods when no interruption of flow will be necessary. 2.1.4 Interruption of Deliveries. In "emergency situations," Englewood may temporarily reduce or eliminate the deliveries of 10 cfs or 13 cfs pursuant to paragraph 2.1.1 or 2.1.2, respectively to Denver at Harva rd Gulch (o r south ), so as to increase the f lo w in City Ditch available for diversion into Englewood's All en Filter plant. P...n "emergency situation" is defined as a casualty, such as an accident, mechanical breakdown, burst pipe, flood , pr esence of a harmful · pollutant which is a threat to the he alth and safety of Englewood's residents, earthquake, fire or winds to rm, which causes Englewood to be unable to make full use of its points of diversion from the South Platte River or Bear Creek , other than City Ditch. In the event of an interruption due to an emergency situation, Enolewood shall take all reasonable and practical actions to enable it promptly to resume full deliv eries to Harvard Gulch or such other location as Denv er may desire. If the reduction or elimination of deliveries at Harvard Gulth (the reduction) lasts for less than 24 hours, Englewood shall not owe Denver any compensation. For any period of reduction in excess of 24 hours, Englewood shall pay Denver for the amount of water not delivered due to the in terruption to the extent the interruption lasts more than 24 hours. For example, in event of a interruption that lasts 30 hours, Englewood would owe Denver for the amount of water not delivered for the last six hours. Englewood shall pay Denver for such water at Denver's lowest then current Outside City raw water rate when the interruption occurs. 2.1.5 Interruption for Maintenance. Englewood shall perform any maintenance work requir i ng either a complete or partial shut-off of deliveries in c_i..ty Ditch with the utmost expediency to minimize water losses. Englewood shall, except in emergency situations, notify Denver of all complete or partial shutoff at least 48 hours in advance. 2.1.6 Water Quality . Englewood makes no warranty as to the quality of the water delivered to Denver, and Denver will accept same "as is". 2.2 Enolewood's Oo erational Responsibility. Englewood shall continue to operate and maintain City Ditch from the Chatfield Reservoir outlet wo rks to the Harvard Gulch blow-off. Englewood shall provide water to meet Denver's delivery obligations to the present contract users on City Ditch south of Harvard Gulch, but such deliveries shall not be in excess of the contract rights to water which may be diverted und er Denver's Cit y Ditch priorities. 2.2.1 Annual Inspection. Representatives of Englewood 5 and Denver will perform annual joint inspections of City Ditch to determine maintenance work required to continue to deliver the rates of flow set forth above. The inspection will be limited to the reach between the valve at the end of the Corps' Chatfield Dam outlet manifold and piping system and Harvard Gulch. The annual inspection shall be made so that all required maintenance work wil l be completed, to the extent practical, prior to April l . 2 .2.2 Littleton Cemetery. Englewood accepts full responsibility for performance of Denver's obligations under that certain agreement b etween Denver and the Littleton Cemeter y Association dated May 13 , 1933, attached hereto and marked "Exhibit E", so as to relieve Denver of any liability with respect theretc. Denver has assigned all i ts rights and obl i ~ati on s un d e r t h a t a gre ement to En g l ewood. L.~ Denver's Oo era t i on al Responsibil i t y . Denver shall continue to operate and maintain City Ditch north of Harvard Gulch, and shall maintain the Harvard Gulch blow-off SLructure at Denver's sole expense. Denver shall be solely responsible for supplying all contract users who divert from City Ditch north of Harvard Gulch from the 10 or 13 cfs to be provided hereunder. Englewood shall have no responsibility for operation or maintenance of City Ditch north of Harvard Gulch. 2.4 Fees Charqed to Contract Users. Englewood will be responsible for charging fees to contract users who divert south o f Harvard Gulch, including establishing fees, billing, and receiving and retaining payments. Englewood will maintain normal business facilities and records for such collections, and annually advise Denver of payment or non-payment. Denver will set fees, bill, receive and retain payment from contract users who divert north of Harvard Gulch. 2.5 Riaht of Reversion or Acauisition. Denver retains the right of reversion as to any contractual right for which an annual service charge is not paid by May 21 of any year. Denver also retains the right to acquire any contractual right in the City Ditch. Except as to those contracts that take water north of Harvard Gulch, any such reversion or acquisition shall increase the amount of water which Englewood is obligated to deliver to Denver; provided that, Denver reimburses Englewood as provided in paragraph 2.6; and provided further, Denver is responsible for any improvements to the City Ditch required to con v ey such water north of the turnout of the contract users which Denver acquires by purchase or reversion. If Denver acquires contract inches which now divert south of Allen filter Plant for delivery north of the filter plant, then Denver will make such improvements, if necessary, to prevent the diminution of the existing capacity (25cfs) to Englewood. 2.6 Denver's Share of City Ditch Expenses. 6 I I I I I I I I I I I 2.6.l Reimbursable Expenses. Denver shall pay a portion of the annual administration, operation, and maintenance expenses (including depreciation l ("City Ditch Costs") for the City Ditch incurred by Englewood when Englewood delivers water under the City Ditch Water Rights for use by Denver. The City Ditch Water Rights are those rights decreed to the City Ditch (a.k.a., Platte Water Company's Ditch) as evidenced by decree of the District Court of Douglas County, adjudicating water rights c.n f o rmer Water Distr i ct No. 8, entered or. December 10, 1883. The City Ditch Costs shall exclude any and all costs associated with the pump station located on the City Ditch which delivers water from the City Ditch to McLellan Reservoir ("McLellan Pump Station") and costs associated with any expansion or improvements of the existing turnout from the City Ditch which delivers water to Englewood's Allen filter Plant. The City D ~tch Costs are to be d etermined b y the sum of the following: A) operation expenses from April through October, i nclusive, and maintenance expenses that occur throughout the vear for that part of the City Ditch north of the McLellan Pump Station multiplied by the ratio of the annual volume of water diverted under the City Ditch Water Rights divided by the total of the annual volume of water diverted under the City Ditch Water Rights plus the annual volume of all other water Englewood may deliver to the Allen filter Plant north of the McLellan Pump Station; plus BJ sixty percent (60%) of the operation and maintenance expenses from April through October, inclusive, for the part of the City Ditch south of the McLellan Pump Station; plus CJ sixty percent (60%) of only the maintenance expenses from November through March, inclusive, for that part of the City Ditch south of the McLellan Pump Station. · The 60% represents the percentage of the current capacity (58cfs) of the riped portion of the City Ditch between Chatfield outlet manifold and the McLellan Pump Station that the former open ditch could carry through this_,.reach (35cfs). Denver's portion of the City Ditch Costs shall be determined by taking the City Ditch Costs calculated as described above and rnul tiplied by sixty one percent ( 61%) . This factor shall remain constant even after Denver makes improvements to the City Ditch conduit pursuant to paragraph 2.1.2. and increases its right to receive water thereby; provided however, that should Denver succeed to the rights of any present contract users south of Harvard Gulch, Denver shall pay six (6) percent of total City Ditch Costs for each one cubic feet per second of water to which Denver succeeds (fractions of a cfs to which Denver succeeds shall be prorated). An example of a calculation of the City Ditch Costs is depicted in Exh1b1t A . .., I 2.6.2 Cacital Costs. Enalewood shal l not charge Denver for City Dit c h capital co itsie~cept for depreciation which shall be included in operation and maintenance expenses and calculated under generally accepted accounting procedures consistently applied). Capital costs are the costs for construction of any new physical structure or improvements t o existing structures that will have a useful li fe of five years or more. The U.S. Army Corps of Engineers (Corps ) do es not presently charge Englewood for costs associat ed with the right-of-way for carriage of City Ditch wat er through the Co rps' Chatfield Reservoir facilities. Any future costs assessed by the Corps shall be conside red an op erat ions and maintenance expense which can be charged to Denver under paragraph 2 .6.1. 2.7 Water Richts. ~~glewood ~111 divert on Denver 's City Ditc~ prioriti es i~ order to obtain the amount of water necessary for the deliv eries to Denver and to the contr act u sers oth er than Denver or Eng le wood. Denver shall not con test Englewood's claim of ownership by contract or o therwise to divert up to 3 .21 cfs under the senior priority of 30 cfs decreed to City Ditch with an appropriation and priority date of November 28, 1860, as evidenced by decree of the District Court of Douglas Coun ty, adjudicating water rights in former Water District 8, entered on December 10, 1883. Englewood has the reversionary right as the co-carrier only to its City Ditch contracts up to 3.21 cfs. Denver does not warrant title to or . the legal or physical availability of the 3 .21 cfs claimed by Englewood. 2.8 Use of Impaired Capacity. To whatever extent the carrying capacity of the ditch is impaired for reasons beyond the control of Englewood and until the ditch can be restored by reasonable dilioence, then the deliver y rate below the obstruction shall be based upon each party's pro-rata deliveries of City Ditch water under this Agreement. If the i mpaired capacit y is due to failure to adequately maintain the City Di tch south of Harvard Gulch (such as removal of silt or removal of debris), then Denver's rights to delivery up to 13 cfs shall be paramount and Englewood's rights to its water secondary until the ditch is restored. 2.9 Use of City Ditch Excess Capacity. If Englewood determines the City Ditch has excess capacity, then Englewood will deliver Denver's remaining City Ditch entitlement; provided that such deli ve ries do not interfere with Englewood's prior obligations or interfere wit h i ts(or its lessee's) present or fu ture use of the Cit y Ditch. 2.10 Storm Drainage into City Ditch. Water in excess of the needs of the users from the City Ditch ("excess water") will be dumped as follows: All excess water introduced or collected in City Ditch south of the turnout in to Little Dry Creek will be dumped into Little Dry Creek. Excess water introduced or collected in City Ditcf. north of the turnout into Little Dry Creek will be dumped at the 8 r , I I I I Harvard Gulch blow-off in t o Denver's storm drainage system. Englewood may not redesign, reconstruct, modify or change City Ditch s o as to increase the amount of storm drainage water that presently collects in and is carried by City Ditch between Little Dry Creek and Harvard Gulch without the prior written consent of Denver. Any rnodif ication, replacement or reconstruction of the existing dump facilities or construction of new dump facilities at Harvard Gulch shall be performed in accordance with plans and specifications prepared by an eng i neer accepted b y Englewo od and Denver as qualified and competent. III. MISCELLANEOUS PROVISIONS 3 .1 Cal cu lat ion c f th e .2-..111o c;::: cf £:·men ses I n curred with Resoect to City Ditch and Hiah Line. Denver and Englewood's expenses h ereunder shal l consist of direct l abor, materials, equipment, v ehicles, and overhead(administration, tools, benefits and leaves) n ecessary to perform the activit i es under this Agreement. Whatever type of expenses charged for by one party may also be charged by the other. For example, if Denver includes as an administrative expense an amount for payroll personnel, Englewood may also, but the amount and methodology should be based on the respective expenditures of each party. Each party shall keep reasonable and consistent records of its hours of direct labor and supervision, material costs, fringe benefits and other payroll levies and equipment usage upon which its costs are based and the methodology used by each party to calculate such charges. Such records shall be kept for at least three calendar years beyond the calendar year during which they were incurred, and shall be available for inspection by representatives of the other party during all reasonable business hours. Each party's documents which show the method of calculation of costs shall be similarly available for inspection. 3.2 Denver's Citv Ditch Water Rights. Nothing herein shall be construed to affect Denver's ownership of its City Ditch Water Rights(except as provided in paragraph 2.7). 3.3 Previous Agreements. This Agr~ement supersedes the Agreement of· February 6, 1970 and any amendments thereto. 3.4 Colorado Law. This Agreement shall be construed under Colorado law. 3.5 Integration. This Agreement constitutes the entire agreement between the parties. It supersedes any prior agreements or understandings between the parties. 3.6 Successors. The rights of each party to receive deliveries shall be binding upon the successor. 9 I I I I. I I I I I I I I I I I I I 3.7 Payment. Charges to each party for administration, ooeration and maintenance exoenses incurred durina each calendar year shall be billed on or before.March 1, of the succeeding year and payment shall be due within thirty (30) days of receipt of billing. 3.8 Charter Provisions. This Agreement is made und er and conformable to provisions of Sections C4.14 through C4.35 of the Charter of the City and County of Denver and the provisions of the Charter of the City of Englewood. Insofar as applicable, said Char ter provisions are incorporated herein and made a part hereof by this reference, and shall supersede any apparently conflicting provisions otherwise contained in this Agreement. 3.9 Term of Aoreement. This Agreement shall be perpetual. January i , hereunder. ATTEST: APPROVED: ~ffe c~ive Date. This Agreement shal l be effective or. 1996 for purposes of calculating charges and deliveries 10 CITY AND COUNTY OF DENVER acting by and through its BOARD OF WATER COMMISSIONERS By:~/££ President CITY OF ENGLEWOOD, COLORADO ,, .. I I I I I I I I I Exhibit A Example of Calculation for Determining Denver's Portion of City Ditch Costs yiven (Example Only) Calc:.ilation n :1 lJ.>1<s1C:i1vDlch ." p Englewood's operation expenses from April through October, inclusive , and annual maintenance expenses nonh of Mclellan Pump Station Englewood's opera rion and maintenance expenses from April through October, inclusive, south of Mclellan Pump Station Englewood's maintenance expenses from November through March, inclusive , sou th of Mclellan Pump Station Annual volume of water diverted under City Ditch Water Rights Annual volume of all water delivered by Englewood to Allen Treatment Plant other than City Ditch Water Rights Citv Ditch Costs S160,000 S I 0,000 $ 5,000 8, I 00 acre-feet 700 acre-feet I) $160 ,000 (8. l 00 a.f.) $147,272 .73 (8, l 00 a.f. + 700 a.f.) 2) 60% x I 0,000 = 3) 60% x 5,000 = Denver's Ponion of Citv D itch Costs 61% x $156,272 .73 = $95,326.37 $ 6,000 $ 3 000 $156,272 . 73 If Denver were to succeed to 20 inches of City Ditch contracts then Denver's costs would be determined as follows: 20 inches = 0.521 cfs 38.4 inches/cfs 0.521 cfs x 6% (increase to Denver's 61 % for each cfs) = 3.12.5% or 61% + 3 .12.5% = 64 .125% 64 .125% x $156,272.73 = $100,209 .89 Water Supply and Facilities Agreement Exhibit "J" Agreement between Denver and Littleton Cemetery Association dated May 23, 1933 I . -.'l.·-·· ·./ EX-H I B IT B Q .-. Fll .. E NO . or>lP COC. NO. d d Agreement, made this ~\ ~ day of : 1 ·• , · \} I I ·• 1\ 1933, between the City anci. Coun:./ o:-De nv er, actine by and through its Board of riater Corunissioners, first party, and I Littleton Cemetery Association, a no n-profit corporation, of Littleto~, Colorado, second party, I ~itness et h that whereas the first party ouns and Jperates a cer t ain ditch takin ~ ~ater from the South ?latte I ~!ver and ~nown as the Cit; Ditcb ; and, I rights evidenced by one share of the capital s tock of The Nevada Ditch Holding Conpa n y and des ires to have the point of I div ersi on of the wate r rights evidenced by said Nevada stock I' changed to the intake of said City Ditch and desi res further to hav e the water evidenced by said Neva da stock carried in said I City Ditch; and, Vlhereas, it is satisfactory to the first party to I carry sai c water in the City Ditcb upon the terms and condi- tions h ereinafter stated; I lJo w, t herefo re, in c ons idera ti on of their mu tual agreeoents the parties h ereto h ave agreed with each other as I follows: 1. The second party at its own expense will secure I such change of point of diversion of the water rights repre- I sented "by its share of Hevada stock to the intak e of the City Ditch and the first pa rty will carry such water in said City ' Ditch to a point i n the Littleton cemetery. 2 . The second p arty at its own expense will install r a b eadga te in the e ast bank of the canal of t ?:.e City Di tcb and a short flume lea.ding from said hea d g ate to a . ';hr ee inch Venturi I· weir and a short f l ume leading from said weir to a pipe line ~· m );y: .;' _.~.- . : .. ~ • . i-· -1::'!:t:":·.~-·: . -~---r f ' ----~PTttL"'rNQ Ci j 0 rY\C. NO d Dd and t bence to a sump where a pwnp will be inst&lled and the water pumped as the second party shall determine. 3. The cost of installine said headg&te, weir, sump, pump and their appliances and maintaining the same shall be borne by the second party. 4. The first party shall make no other charge for carrying said water in tbe City Ditc h than the usual charge for cc..rrying a like &.mount of City Ditch water therein. 5. The first party shall bave the right to discon- tinue carrying said Nevada water in sc.id City Ditch at any time 1vhen tbe carriage thereof shall interfere, in the opin- ion of the engineers of the first party , with the carriage of City Ditch water in said ditcb and shall also have the right to stop such carriage in case the City Ditch is ever abandoned es a carrier of City Ditch water. In Witness Whereof, the parties hereto have caused this instrument to be executed in triplicate by the proper of- ficers of the parties h ereto as of the day of the date hereof. / -~·- Secretary; Attest; Approved as to form; City and County of Denver, B~Bo~~issioners , .By >-~--- Pre si den r;::: Littleton Cemetery Association, .By '~dent.